France avoids downgrade from Moody’s in boost for Macron’s government
Rating agency retains Aa3 score as it assumes ‘deficit-reducing budget for 2027 will be adopted’
On October 23, Moody's maintained France's credit rating at Aa3, avoiding a downgrade amidst ongoing social unrest and fiscal challenges. The rating agency's periodic review found the government's 2027 budget credible, which would help restore public finances. However, Moody's noted that the deficit-reducing budget for 2027 must be enacted for the Aa3 rating to remain stable.
Meanwhile, rising borrowing costs and social tensions continue to weigh on France's economy. The upcoming presidential election on April 18 and May 2 may further complicate efforts to pass the budget, as opposition parties may reject the legislation and potentially bring down the government in a no-confidence vote. The French finance ministry emphasized that the rating reflects confidence in the proposed budget, but opposition to further cuts and raises in the minimum wage has led to more protests, with the next one planned for Saturday.
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