PARIS (Reuters) - The French government’s target to rein in public spending next year by 21 billion euros may be lowered due to low inflation, Finance Minister Michel Sapin said in an interview with Agence France Presse published on Tuesday.
“We cannot have the same targets with inflation getting so low,” Sapin told the French news agency in response to a question about whether the 2015 target would be kept.
The government had hoped to wring 21 billion euros of savings from the budget as part of a drive to bring public spending down by 50 billion euros over the next three years compared to its long-term growth trend.
At close to a five year low of only 0.6 percent year-on-year in July, inflation is proving weaker than expected by the French government, which had estimated inflation this year would be 1.2 percent.
Reporting by Jean-Baptiste Vey, writing by Leigh Thomas, editing by Geert De Clercq