Moody's downgrades France's credit rating

International credit rating agency Moody's has downgraded France's credit rating from Aa2 to Aa3, while revising its outlook to stable. The downgrade is based on the weakening of the country's public finances and the forecast that fiscal consolidation will become more difficult due to political fragmentation.

Don't leave your news choices to an algorithm - decide for yourself what you read. Add 12punto to your preferred sources! Don't leave your news to an algorithmYou decide which source to read; add 12punto to your preferred sources.

Moody's downgrades France's credit rating

1 / 6

In a statement, international credit rating agency Moody's announced that France's credit rating has been downgraded from Aa2 to Aa3.

2 / 6

The statement noted that the downgrade reflects the view that the country's public finances will weaken significantly in the coming years, pointing out that political fragmentation makes it more likely that meaningful fiscal consolidation will be hindered.

3 / 6

REMINDER THAT THE GOVERNMENT FELL

Recalling that the government fell at the beginning of December, it was stated that the new government is expected to pass a special law in 2025 to ensure the continuity of public administration. However, looking ahead, it was emphasized that the next government is unlikely to reduce fiscal deficits in a sustainable manner, and it was reported that France's public finances are estimated to be weaker over the next 3 years than previously projected in October.

4 / 6

It was also noted that the country's credit rating outlook has been revised from negative to stable, with the stable outlook reflecting France's significant credit strengths.