This photo shows signage for Fitch Ratings, Sunday, October 9, 2011, in New York. HENNY RAY ABRAMS / AP
Fitch downgraded France's credit rating on Friday, September 12, from "AA-" to "A+", as President Emmanuel Macron struggles with political instability and deep disagreements on how to put the country's strained public finances in order.
"The government's defeat in a confidence vote illustrates the increased fragmentation and polarization of domestic politics," Fitch said. "This instability weakens the political system's capacity to deliver substantial fiscal consolidation," added the US ratings agency, saying it was unlikely the fiscal deficit would be cut to 3% of GDP by 2029, as the outgoing government had wanted.
It also said France's debt mountain would keep rising until 2027 unless urgent action was taken. The move comes just four days after François Bayrou resigned as prime minister after losing a parliamentary confidence vote over an attempt to get an austerity budget adopted. He had sought major spending cuts in the budget in a bid to cut the French deficit and debt.
Reacting to the announcement, Bayrou said on X that France was "a country whose 'elites' lead it to reject the truth [and] is condemned to pay the price."
