Fitch Ratings has cut France’s credit rating from AA- to A+, citing political instability and worsening public finances, a move that intensifies pressure on President Emmanuel Macron and new Prime Minister Sébastien Lecornu.
The downgrade follows months of political upheaval, including the ousting of former Prime Minister François Bayrou after his austerity-driven budget failed to win parliamentary support. Fitch warned that France’s debt, already at 113.2% of GDP in 2024, could rise to 121% by 2027, with little chance of stabilisation before the 2027 presidential elections.
The agency expressed doubts about the government’s ability to reduce the deficit below 3% of GDP before 2029, noting France’s current deficit is 5.8% of GDP, one of the EU’s highest. Fitch highlighted the political paralysis, frequent government collapses, and public resistance to spending cuts as barriers to fiscal reform.
Finance Minister Eric Lombard sought to reassure investors, stressing the “solidity of the French economy” and pointing to consultations underway to secure a new budget. Economists say France retains key strengths—such as high household savings, stable unemployment, and low inflation—but warned that fiscal space is narrowing.
France is now the third most indebted country in the eurozone, after Greece and Italy. While Germany and the Netherlands hold the bloc’s strongest credit ratings, France’s outlook contrasts with southern European nations, which—despite higher debt—enjoy relatively more positive assessments from rating agencies.
S&P Global is expected to issue its own update on France’s credit outlook in November, which could bring further pressure depending on the government’s next fiscal moves.
