The sell-off in French bonds is a warning for governments elsewhere, but we doubt it is the start of a broad fiscal crisis. Few advanced economies have comparably poor fiscal arithmetic, and those that do have greater political consensus or stronger lines of defence. The more likely, if less severe, consequence is that the episode hastens necessary fiscal consolidation, weighing on global growth in the next few years.
Our senior economists will be holding an online drop-in session today at 14:00 GMT to discuss French fiscal risks, the threat of contagion and what comes next. Please click here to register.
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