Fitch downgrades France’s economic outlook from stable to negative
The assessment follows official figures showing the country's economy has failed to grow so far this year and contracted in Q3.
Fitch Ratings has lowered its outlook for France's economic prospects from stable to negative, citing rising debt levels and fiscal challenges. The agency predicts that France's debt will increase from nearly 115.7% of GDP in 2025 to 124% in 2028. Factors contributing to this downward revision include weaker economic growth, worsening fiscal policies, and higher borrowing costs.
France is set to hold presidential elections in April-May 2027, with political uncertainty potentially hindering efforts to implement fiscal consolidation. The upcoming election, as well as ongoing public protests and budget negotiations, have not improved Fitch's confidence in achieving the necessary deficit reduction to stabilize the debt.
Finance Minister Roland Lescure warned that failure to implement the proposed budget cuts for 2027 could lead to a fiscal crisis.
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