Credit-Prone France No-Surprise Downgrade. . . with a Stable Outlook?

French credit rating

Standard & Poor's (S&P) downgraded France's long-term credit rating on October 17, 2025, to A+ from AA- with a stable outlook. 

This "unscheduled" downgrade was a surprise to many. It follows a similar downgrade by Fitch in September 2025.

Fitch downgrades France in shock move
Uploaded: Sep 15, 2025

S&P cuts France’s credit rating to A+ over political instability risking deficit

France's Political Chaos Triggers Unexpected S&P Downgrade

S&P Global on Friday downgraded France from AA to A+ in a surprise update on the eurozone's second-biggest economy, warning that political instability put the government's efforts to repair its finances at risk.
Issued on: 18/10/2025 - 07:28

By:FRANCE 24 

 

 

Credit agency S&P said Friday it had cut its rating for France to A+ from AA, citing risks that the government would fail to significantly reduce its deficit next year.

• "Despite this week's submission of the 2026 draft budget to the parliament, uncertainty on France's government finances remains elevated," S&P said in a statement.

French President Emmanuel Macron is trying to push deep spending cuts through a divided parliament where his centrist party and its allies do not have a majority.

His new Prime Minister Sébastien Lecornu, hoping to avoid being ousted by a no-confidence vote, backtracked this week on a widely contested pension reform that would have pushed the official retirement age to 64 from 62.

• "While, in our view, the 2025 general government budget deficit target of 5.4%of GDPwe believe that, in the absence of significant additional budget deficit-reducing measures, the budgetary consolidation over our forecast horizon will be slower than previously expected," S&P said.

In response to the downgrade, Finance Minister Roland Lescure said the government "reaffirms its determination to meet the deficit target of 5.4 percent of GDP for 2025".

INSERT ABOUT THAT STABLE OUTLOOK 

 

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1. "It is now the collective responsibility of both the government and parliament to ensure the adoption of a budget consistent with this framework," he said in a statement.
2.  The finance ministry said separately that the government had submitted a draft budget for 2026 "which aims to accelerate the reduction of the public deficit to 4.7 percent of GDP while preserving growth".
3.  "This is a key step that will enable us to meet France's commitment to bring the public deficit below 3 percent of GDP in 2029," the ministry added. 

"It is now the collective responsibility of the government and Parliament to ensure that a budget is adopted within this framework before the end of 2025."

 

 

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