Fitch Ratings affirmed France’s sovereign debt rating at A+ with a stable outlook on Friday, citing the country’s robust economy and institutions, while also acknowledging high public debt and a complex political landscape.
The rating agency noted in a statement that France boasts a diversified economy with a per capita income and governance indicators exceeding the median for countries in the A+ category. This decision comes as investors closely monitor the fiscal health of major European economies.
However, Fitch cautioned that “a high and rising level of public debt, a sociopolitical context complicating medium-term budgetary consolidation, and relatively weak potential growth weigh on the rating.”
France’s Minister of the Economy, Roland Lescure, welcomed the decision, stating it “follows the efforts undertaken by the government within the framework of the 2026 budget to control public finances.” He added, “The government remains fully mobilized to continue reducing the deficit and debt.”
Difficult Discussions Expected in 2027
Fitch Ratings has maintained its A+ rating for France since September, classifying the country’s debt as “upper medium quality.”
Previously, in the fall, the agency expressed concern over France’s track record in reducing its public deficit and adhering to European Union budgetary rules. It also highlighted “increasing fragmentation and polarization of French political life.”
More recently, French economic growth in 2025 surpassed government expectations, reaching 0.9% compared to a projected 0.7%.
Prime Minister Sébastien Lecornu successfully secured passage of a compromise budget in February, with support from socialist lawmakers. However, the 2026 budget was approved with a smaller-than-anticipated deficit reduction – 5% of GDP, as stipulated in the finance law, versus the 4.7% initially proposed – as the government made significant concessions to the left, including suspending pension reforms.
Fitch anticipates that discussions surrounding the 2027 budget will be equally challenging, noting “little scope for rapid fiscal consolidation before the 2027 presidential election.”
The agency projects a public deficit of 4.9% of GDP in 2026, “close to the government’s target of 5%.” This would represent a slight improvement over the estimated 5.4% for 2025, but would still remain above the 3.3% median for A-rated countries.
This article was published automatically. Sources: ats / afp
