By Ira – JBizNews Desk

A wave of public anger over the rising cost of living swept across Europe on Saturday, drawing more than 400,000 people into the streets of France and spreading to Italy, Spain and Albania, in the continent’s largest show of unrest in years.

In France, the epicenter of the movement, crowds marched in Paris and cities nationwide to demand more funding for schools and relief from soaring prices. France’s Interior Ministry counted about 410,000 demonstrators across the country, including 110,000 in the capital. The CGT labor union, one of the organizers, put the national figure closer to 800,000.

The Paris march began peacefully. But near its endpoint in the east of the city, masked protesters hurled objects and fireworks at police, who answered with tear gas, sound grenades and water cannons. Authorities said nearly 1,000 people were arrested nationwide. Armored vehicles rolled into position in Paris and Marseille, and in Lyon police fired tear gas to break up a gathering in an area where demonstrations had been banned.

Saturday’s turnout was smaller than the 550,000 the government counted a week earlier, when protests tipped into rioting and looting. That violence left the historic town hall in Limoges, built in 1883, largely destroyed by fire.

The unrest is no longer contained to France. In Italy, thousands clashed with police in Rome, Milan, Turin, Bologna and Florence over wages, living costs and public services, and soldiers were deployed to patrol Milan’s streets. In Madrid, pensioners marched for better retirement pay. In Albania’s capital, Tirana, riot police used tear gas and water cannons against opposition supporters and students, with 2,500 officers on the streets. In Brussels, shop owners boarded up their windows, fearing a repeat of last week’s looting.

Why it matters for your money

The streets are now moving markets. This week, the interest rate France pays to borrow for 10 years rose above 5% for the first time since 2002. The gap between French and German borrowing costs – a key measure of how risky investors think France has become – widened to its largest since 2011.

On Friday, the credit rating agency Moody’s decided to keep France’s current rating in place, giving the government some breathing room. But it held onto its negative outlook, warning that “the fragmentation of France’s political landscape will continue to impair the functioning of the country’s legislative institutions.”

The pressure is showing up in company results, too. The French stock market has fallen 4.5% over the past month. Supermarket giant Carrefour cut its profit forecast this week, blaming the unrest along with rising energy costs for weak shopper confidence, and its shares plunged more than 14% in a day. Chief executive Alexandre Bompard called it an “unprecedented situation.” Economists expect the French economy to grow just 0.3% this year.

The political stakes are just as high. The protests, now in their second month, began with high school students demanding more teachers and funding, and have grown into a direct challenge to President Emmanuel Macron in the final stretch of his presidency. France holds a presidential election in May. The government has accused the hard-left France Unbowed party and its leader Jean-Luc Mélenchon of stoking the violence – an accusation the party denies.

What to watch

Two dates now matter most. On Tuesday, France’s parliament resumes debate over a budget meant to shrink the country’s deficit, and the outcome will tell investors whether the government can still govern. Then on November 5, unions have called a national day of strikes and protests that will test whether this movement is fading or just getting started.

JBizNews Desk | Paris, France

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