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Economy: the consequences of the drop in the French public debt rating
On May 31, the S&P rating agency downgraded the rating of French public debt. Are France’s finances at half mast?
(Franceinfo)
On May 31, the S&P rating agency downgraded the rating of French public debt. Are France’s finances at half mast?
The government feared this decision. Why was the rating downgraded from AA to AA-? According to the rating agency Standard & Poor’s, public debt could be too high in the coming years. Even if the government assures that it will fall below 3% of GDP by 2027, Standard & Poor’s forecasts instead 3.5%. According to the Minister of the Economy, Bruno Le Maire, France remains among the best-rated countries on the planet. “France maintains a rating of around 17 out of 20, it was at 18, it rose to 17 out of 20”he explains.
According to Bruno Le Maire, this drop in rating will have no consequences in the lives of the French. It even excludes a new tax increase in 2025. But this reduction could lead to difficulties in investing. This rating was given one week before the European elections and the opposition parties, starting with Marine Le Pen, criticize the government for its economic policy. According to LFI MP Éric Coquerel, the government will use this decision to justify further budget cuts.
