The credit rating agency S&P Global Ratings has downgraded France’s credit rating from AA- to A+, citing ongoing uncertainty over the country’s public finances despite the recent presentation of its 2026 budget proposal.
This marks the second time in 18 months that S&P has downgraded France. In September, the agency Fitch also lowered its credit rating of the country.
Reacting to the announcement, Economy Minister Roland Lescure acknowledged the decision, stating, “The government confirms its determination to meet the deficit target of 5.4% of GDP for 2025.”
S&P noted that while France is likely to reach its 2025 deficit target, further substantial measures are needed to accelerate fiscal consolidation. Without additional steps to reduce the budget deficit, the agency predicts slower fiscal recovery than expected.
The agency also warned that France’s gross public debt could rise to 121% of GDP by 2028, compared to 112% at the end of 2022.
France’s Ministry of the Economy defended the recently submitted 2026 budget proposal, which aims to cut the public deficit to 4.7% of GDP while maintaining economic growth. It called the proposal “a key step” toward the country’s commitment to reducing the deficit below 3% of GDP by 2029.
The ministry emphasised the shared responsibility of the government and Parliament to adopt a budget aligned with this framework by the end of 2025.
The downgrade comes as France awaits further rating decisions, including a review by Moody’s on 24 October. It follows a similar move by Fitch in September, which reduced France’s rating to A+ over concerns about political instability and budgetary uncertainties.
Agencies such as S&P, Moody’s, and Fitch assess a country’s creditworthiness, rating it on a scale from AAA (the highest) to D (default). Downgrades are problematic because they can lead to higher borrowing costs for countries.
France’s debt repayments are projected to amount to around €55 billion in 2025, as its borrowing costs have already climbed significantly due to political and economic concerns.
With the A+ rating from S&P, France now shares the same credit rating as Spain, Japan, Portugal, and China.
