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French jobs numbers darken festive mood

Wednesday, December 24, 2014 - 02:25

Consumer spending provides some cheer for the French economy. But it's short-lived as it's revealed that more people were out of work in France last month than ever before, while across Europe, the debate over austerity raises its head again. David Pollard reports.

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It's the last minute dash before Christmas - and it's giving French retailers a healthy boost. In fact, latest figures show consumer spending rebounding in France. Up 0.4 per cent in November after a drop of 0.8 per cent in October. While overall the French economy is growing, if sluggishly - eking out a 0.3 per cent rate in the third quarter. The French numbers are part of very mixed feedback on whether Europe is managing to get off the ground. The Bank of Spain upgraded its 2014 GDP forecast this week. But Italy reported that retail sales were flat again in October. And while parliament there approved Prime Minister Matteo Renzi's 2015 budget, there are still worries over whether Rome can control its public debt. France's public finances are still a cause for anxiety, too, says FXPro's research head, Simon Smith. SOUNDBITE (English) SIMON SMITH, HEAD OF RESEARCH, FXPRO, SAYING: ''We all know the issues in France. You may get some better numbers here and there but deep down they've run a budget deficit pretty much since I was born more than 40 years ago. That's the issue, and unless that changes, and unless you get a more competitive economy, then one or two bits of better data might be fine, but it's not going to get to the root cause of the problem.'' Those worries are dragging the euro down - to a fresh 28-month low. Compounded by concerns over Greece, where the possibility of an election is seen making the anti-austerity party Syriza a contender for power. IG market analyst Alastair McCaig. SOUNDBITE (English) ALASTAIR MCCAIG, MARKET ANALYST, IG , SAYING: ''We're also going to see a general election, or most likely see a general election in Greece possibly in February time, the beginning of. I just wonder if that's going to refocus traders' and investors' mentality to the austerity measures that have been taken and quite frankly those that still need to be taken around the euro zone, maybe not just the likes of Greece or Italy or Portugal but maybe focus a little bit higher up that tree. The likes of France still have quite a few hurdles that they have to clear before they start being an asset to the (european) union.'' Latest jobs numbers give little hope of that happening soon. November's jobless total rose by 27,000 - meaning more people were unemployed in France than every before.

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French jobs numbers darken festive mood

Wednesday, December 24, 2014 - 02:25