In brief
Fitch Ratings now flags France’s long‑term credit outlook as negative, citing weaker growth, higher borrowing costs, and a widening budget deficit. The agency keeps the A+ rating but cuts GDP growth forecasts and projects debt‑to‑GDP to rise to about 124 % by 2028. The comments reflect France’s ongoing political fragmentation and fiscal challenges.
In Paris on Monday, Fitch said it had revised France’s long‑term issuer default rating outlook from stable to negative while keeping the country’s fiscal rating at A+.
Fitch’s report cited a slowdown in economic growth, rising borrowing costs and a broader budget deficit since its August 2026 review, which together have deteriorated France’s debt dynamics from an already weak starting point.
Economic analysts noted that persistent political fragmentation and the challenging social environment have made sustained fiscal consolidation more difficult, according to the rating agency.
Fitch lowered its forecasts for France’s real GDP growth to 0.5 percent in 2026 and 0.9 percent in 2027, down from previous estimates of 0.8 percent and 1.1 percent. The rating agency also projected that the country’s debt‑to‑GDP ratio would climb from 115.7 percent in 2025 to about 124 percent in 2028, pushing up from its earlier estimate of 122.7 percent.
The report highlighted that a large share of public spending is politically difficult to cut, and that the high tax burden limits opportunities for further revenue growth. France’s projected budget deficit would hit 6.4 percent of GDP in 2027 without additional consolidation measures, a figure higher than the earlier 5.9 percent projection.
The draft 2027 budget, which targets a 5.0 percent deficit, includes politically difficult measures that could raise implementation risks, Fitch warned. France’s economy contracted 0.1 percent in the third quarter of 2026, preliminary data from the French National Institute of Statistics and Economic Studies suggested, further highlighting downside risks to the agency’s growth outlook.