The rating agency Fitch has maintained the rating of French debt at AA-, six months after having downgraded it, as well as the outlook, considered stable, according to a press release published Friday.
If France can boast of having “a large, rich and diversified economy, strong and efficient institutions and macro-financial stability (…) its public finances, and in particular its significant level of debt, constitute a weak point in its rating,” noted the agency.
The Minister of the Economy Bruno Le Maire took “note of Fitch’s decision” in a statement to AFP, saying he was “totally determined to restore France’s public finances”.
Fitch, which currently gives France a rating of “AA-”, one of the best possible, a sign that the country remains very credible in the eyes of the markets, however judged that the deleveraging trajectory was “limited”.
S&P due December 1
“The draft budget for 2024 and the multiannual program only envisage a limited reduction in the budget deficit, from 4.9% in 2023 to 4.4% in 2024,” notes the rating agency, which adds that it expects for its part to a public deficit of 4.6% in 2024, due to a “lower estimate (than that of the government) of growth” and the “risk that savings (…) will not be made”.
Fitch’s rating has a “stable” outlook, meaning Fitch has no plans to change it at this time.
Fitch is the second agency to look at France again this year, after Moody’s last Friday which did not update its rating and before Standard & Poor’s (S&P) on December 1st. Although it had few consequences on the markets, the downward revision of the financial rating by Fitch last April was a warning shot.
The agency had notably mentioned “significant budget deficits and modest progress” regarding their reduction, after three years of abundant public spending intended to cushion the shock of Covid and inflation and social tensions around pension reform .