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According to data released by the French Statistical Office a few days ago, due to multiple factors such as recent geopolitical instability, rising refined oil prices, Italian political situation and trade tensions between Europe and the United States, the French business climate index declined in May, which will affect the government’s future The expected economic growth rate throughout the year and the effect of reform policies have restricted the previous strong growth momentum of the French economy.

     As the main indicator that reflects economic development and predicts the trend of economic growth, the upward momentum of the French business environment index has gradually slowed since the end of 2017 and declined in May. Although the French business climate index reached 112 points in December 2017, the highest level in the past 10 years, according to the latest statistics released by the French Statistical Office, the current French business climate index has dropped to 106 points, which is only 6 points in 2017. The monthly level shows that although the French economy is still in the recovery zone, its growth momentum is far less robust than in 2017. In addition, the Bank of France also recently stated that it has lowered France's economic growth forecast for the second quarter to 0.3%.

The French economic community has paid attention to the continued downturn in the domestic business atmosphere this year, and has made a multi-angle analysis. BNP Paribas chief economist William De Verde believes that France is not the only country in Europe that has a sluggish business climate. Germany and Italy have also experienced the same weakness since January 2018. DeVide said: "As the current economic recovery in the Eurozone continues, European economists are worried about the downturn in the business climate, but we must first determine whether this downturn is an inevitable fluctuation in economic development or whether the economic momentum is fundamental. Decline.” According to the chief economist of Société Générale de France, Misala Marcoussen, a combination of recent research data shows that the previous strong growth momentum of the euro zone economy has declined since the beginning of 2018, and this growth rate has slowed down. Related to multiple factors. On the one hand, the current exchange rate of the euro has risen by about 8.5% from the 2017 average, and the global monetary tightening policy has also been gradually released, making the eurozone lose its previous favorable monetary environment. On the other hand, oil prices have also risen recently, which has had a certain impact on production and investment in the industrial sector. Marcusson believes that these factors will continue to restrict economic growth in the euro zone in the future and make it fall into a low-growth range.

      At the same time, the current sluggish business atmosphere in Europe is also related to the recent international geopolitical tensions, such as the recent unilateral withdrawal of the United States from the Iranian nuclear agreement, obstacles in the coordination of trade policies between Europe and the United States, and the rise of the Italian populist government, which have all increased to varying degrees. The instability of the external economic environment in Europe. The European Central Bank pointed out in a recent report that there are signs that the current European market demand growth is gradually slowing down, and external uncertainties will make market demand weaker and will bring multiple risks to the future development of the European economy. In this regard, the European economics community calls on the governments of the euro area to continue to strengthen the core of economic development, and to properly solve the current labor market difficulties in the euro area, such as recruitment difficulties and insufficient financial support, to prevent them from causing structural constraints on production growth. At the same time, European governments should continue to resolutely implement economic reforms, keep market demand active through stimulus policies, further strengthen the sustainability of government finances, and re-emerge European economic recovery with a strong and stable momentum.

As the third largest economy in the Eurozone, Italy's domestic political situation has triggered market concerns about the prospects of the Eurozone, and the doubts surrounding the Euro and the European Union have once again heated up. Some analysts pointed out that the “difficult delivery” of the new Italian cabinet shows that the opposition between the populist parties and the traditional establishment is serious. This trend of division will have an impact that cannot be underestimated on Italy and the European Union in the future.

The radical propositions of Italian populist parties worries the EU. First of all, the outlook for Italy's internal affairs is unpredictable. Although Matarella had successfully prevented the birth of a populist government before, the Italian populist alliance believed that this was the result of remote control by the Berlin and Brussels authorities behind the scenes. Matarella was not only a “puppet in front of the stage”, but also “together with "Criminals of external forces interfering in Italy's internal affairs", this highly inflammatory "accusation" not only makes it difficult for Mattarella to "block" populist forces in the future, but also arouses the resonance of many irrational voters. Therefore, it will be much more difficult for Mattarella to "slip on the brakes" against Italian populist forces in the future.

Second, the uncertainty of the financial market is rising rapidly. According to the ruling plan of the Populist League of Italy, in the future, it will require the European Central Bank to forgive Italy's 250 billion euros of public debt at one time and additional expenditures of 100 billion euros. Considering that the current debt scale of the Italian government has accounted for 23% of the euro area as a whole, this "unbelievable" proposition not only made many EU member states exclaimed, but also significantly affected the market's confidence in the euro area's economic prospects.

Finally, the threat of populism has not receded. As a heavyweight country within the European Union and the Eurozone, Italy is currently facing the dilemma of forming a cabinet. It is not only the result of the country's weak economic recovery and the high pressure of refugees, but also a manifestation of the still strong populism in Europe. Italian polls show that after Conte resigned, the support rate of the populist alliance rose instead of falling. This shows that even if the general election is restarted in the future, the populist party is still very likely to be the winner.

Some analysts believe that the EU, as a loosely structured political union, cannot actually interfere too much in the political situation of Italy. Once the "black swan" flies out, the euro zone economy, which is still in the process of recovery, will be unable to withstand such a major market turmoil. In this dilemma, the shortcomings of Western "popular politics" will surely arouse doubts and reflections again.