Fitch Ratings has downgraded France’s long-term credit rating from “AA-” to “A+”, citing political instability and worsening public finances. The move intensifies pressure on President Emmanuel Macron and new Prime Minister Sébastien Lecornu, who took office following François Bayrou’s failed budget gamble and subsequent ousting.
The US-based agency warned that France’s debt burden—already at 113.2% of GDP in 2024—is projected to climb to 121% by 2027, with no signs of stabilization. It also forecast that France would miss its EU deficit target, remaining well above 3% of GDP until at least 2029.
Fitch blamed the downgrade on political fragmentation and repeated government collapses since the 2024 snap elections, which it said had undermined the country’s capacity for “far-reaching fiscal consolidation.” It also warned that the run-up to the 2027 presidential election would likely block serious reforms.
The timing compounds a grim outlook for France’s pharmaceutical and industrial base, already rattled by declining investment, while also raising concerns for households about potential rises in loan interest rates.
Finance Minister Eric Lombard downplayed the downgrade, pointing to France’s economic “solidity” and highlighting Lecornu’s consultations to push through a new budget. Economists, however, stressed that France’s deficit—5.8% of GDP in 2024, one of the highest in the EU—requires urgent correction.
Despite the downgrade, France retains some strengths: a diversified economy, strong demographics, robust household savings, and low inflation compared to EU peers. INSEE forecasts 0.8% GDP growth in 2025, with domestic demand expected to be the main growth driver.
France now sits as the third most indebted eurozone nation, behind only Greece and Italy. Rival agency S&P Global is expected to issue its own assessment in November, a move that could further influence investor confidence.
