EUROPEAN FISCAL: Improved France Central Govt Deficit Tracking On Lower Spending
- Today’s data for the central government cash balance saw a budget deficit of E156.3bn in 2024 or 5.4% GDP, an improvement from the E173.3bn or 6.1% GDP in 2023 on the same cash and central government basis.
- Whilst it’s not directly compatible to national accounts basis figures used in the budget, it points to a greater directional improvement compared to the 5.4% GDP forecast for the central and state government deficit in 2024 in the October draft budgetary plan after the realized 5.6% GDP in 2023.
- This was part of the draft plan that saw a general government (i.e. incl local governments and social security) deficit of 6.1% GDP in 2024 after 5.5% GDP in 2023.
- This draft budgetary plan had pencilled in a general government deficit of 5.0% GDP in 2025 although this has since of course been lifted to a target of 5.4% GDP by the new Bayrou government having been forced through parliament without a vote on Monday. [See our political risk team’s post at 1653GMT on the fallout from this approach: Gov't To Survive 5 Feb Votes; Censure Motion Next Week Greater Threat].
- Back to the details in today’s central government cash data, the bulk of the improvement on the year came from total expenditure falling to E511.1bln vs E522.7bln in 2023.
- Total revenues also modestly increased to E357.2bn in 2024 vs E354.5bn in 2023, helped by “other tax revenues” at E67.5bn vs E65.5bn in 2023.
- The press release notes the increase in other tax revenues was "mainly due to the growth in other domestic taxes [+E2.0bln] and the solidarity levy [+E0.8bln]" though these were partially offset by a "slight decrease in net IR revenues [-E0.6bln] and the state share of net TICPE (internal consumption tax on energy products) [-E0.8bln]".
- Non-tax revenues fell to E23.2bn vs E25.1bn in 2023, mainly because of an EU RRF payment.
- Finally, special accounts recorded a deficit of E2.35bn vs the E5.1bn in 2023.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
JGB TECHS: (H5) Returns Lower
- RES 3: 149.55 - High Mar 22 (cont)
- RES 2: 147.74 - High Jan 15 and bull trigger (cont)
- RES 1: 144.48/146.53 - High Nov 11 / High Aug 6
- PRICE: 142.12 @ 15:01 GMT Jan 03
- SUP 1: 141.65 - Low Dec 30
- SUP 2: 141.56 - 1.764 proj of the Aug 6 - Sep 3 - 9 price swing
- SUP 3: 141.05 - 2.000 proj of the Aug 6 - Sep 3 - 9 price swing
Markets slipped on the hawkish Fed and are yet to fully recover, touching 141.65 on the way lower. Medium-term trend signals on the continuation chart continue to point south. A resumption of the trend would pave the way for a move towards 141.56, a Fibonacci projection point on the continuation chart. A stronger recovery would open 144.48, the Nov 11 high. Further out, key resistance is at 146.53, the Aug 6 high (cont).
USDCAD TECHS: Bull Flag Highlights A Clear Uptrend
- RES 4: 1.4669 2.0% 10-dma envelope
- RES 3: 1.4539 3.382 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 2: 1.4508 3.236 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 1: 1.4467 High Dec 19
- PRICE: 1.4392 @ 15:50 GMT Jan 3
- SUP 1: 1.4336 Low Dec 20
- SUP 2: 1.4307/4232 20-day EMA / Low Dec 17
- SUP 3: 1.4136 50-day EMA
- SUP 4: 1.4011 Low Dec 5
USDCAD is unchanged and bulls remain in the driver’s seat. The latest pause appears to be a flag formation - a bullish continuation signal. Note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.4508 next, a Fibonacci projection level. Initial firm support to watch lies at 1.4307, the 20-day EMA. A pullback would be considered corrective.
AUDUSD TECHS: Southbound
- RES 4: 0.6471 High Dec 9
- RES 3: 0.6408 50-day EMA
- RES 2: 0.6341 High Dec 18
- RES 1: 0.6247/6282 High Dec 30 / 20-day EMA
- PRICE: 0.6204 @ 15:21 GMT Jan 3
- SUP 1: 0.6179 Low Dec 31
- SUP 3: 0.6158 1.236 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6100 Round number support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
A bearish trend condition in AUDUSD remains intact and the pair continues to trade closer to latest lows. Recent weakness maintains the price sequence of lower lows and lower highs. Note that moving average studies are in a bear-mode position too, highlighting a dominant downtrend. Scope is seen for an extension towards 0.6158 next, a Fibonacci projection. Initial firm resistance to monitor is 0.6282, the 20-day EMA.
