EMU hopes raised
Saturday 04 October 1997
Though the leak was supported yesterday by Labour's Peter Mandelson, speaking on Irish television, the Treasury later backtracked, saying Labour's position had not changed.
Gwyn Hacche at James Capel said both Germany and France are more clearly committed to meeting budget deficit targets. Germany now estimates that its 1997 half-year deficit will be 3.1 per cent of GDP, In France, the Socialists, initially resistant to targets, now predict they will achieve a 3 per cent deficit in 1998.
Members of the Italian communist party are threatening to derail the government's tough 1998 budget if proposed pension reforms go through, unsettling the markets. However, Michael Lewis at Deutsche Morgan Grenfell said: "The Italians will not allow this crucial budget to be knocked off course."
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