Finances Rating agency Moody's warns France with negative outlook
The rating agency Moody's has made a critical statement about France. Although the US agency has left France's sovereign rating at Aa3, it has lowered the outlook from "stable" to "negative", threatening a possible downgrade of the country's credit rating.
25.10.2025, 01:09
SDA
The rating agency Standard & Poor's had already carried out the downgrade a few days ago, while Fitch downgraded the rating from AA- to A+ in mid-September.
Moody's justified the move with France's increasing political fragmentation and the resulting risks to a stable financial policy. In addition, the delayed reforms, for example with regard to pensions, could weaken the economy's growth potential.
The decision signals caution, but spares the highly indebted country from a direct downgrade, which would increase the interest burden on government bonds.
At around 3.3 trillion euros, France has the highest debt in the European Union. Measured in terms of economic output, the debt ratio of 114 percent is the third highest after Greece and Italy. Government spending is also among the highest in Europe. There have long been concerns that France could slow down Europe's already weak economic development.
