Troubles seem to be coming to the eurozone economy not as single spies but in battalions. These troubles include an Iranian-induced energy price shock, an onslaught of Chinese exports in the form of the so-called China 2.0 shock, and a spike in long-term bond rates as part of the global government bond market meltdown. Such a cocktail of troubles would pose strong headwinds to the eurozone economic recovery in the best of times. However, they could be particularly problematic today when France, the eurozone’s second-largest economy, seems to be on the cusp of a sovereign bond crisis ahead of this April’s presidential election.
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