Rating agency S&P Global Ratings announced on Friday, October 17th, that it was downgrading France’s credit rating by one notch to A+, stating that “despite the presentation of the 2026 budget draft this week, uncertainty surrounding French public finances remains high”.
Less than a week after the formation of the new government team and three days after the publication of a draft budget law for next year, S&P Global Ratings announced the downgrade of France’s rating to A+. “Despite the presentation of the 2026 budget draft this week, uncertainty surrounding French public finances remains high,” stated the agency, which is one of the three most influential alongside Moody’s and Fitch.
Reacting to this second downgrade by S&P (formerly Standard & Poor’s) in a year and a half, the Minister of the Economy said he “(took) note” of the decision. “The government confirms its determination to meet the target of a 5.4% of GDP deficit for 2025,” the ministry added.
According to S&P, if this “target of a 5.4% of GDP public deficit in 2025 is met,” “in the absence of significant additional deficit-reduction measures, fiscal consolidation over its forecast horizon will be slower than expected.” The agency forecasts that “gross public debt will reach 121% of GDP in 2028 compared to 112% of GDP at the end of last year,” it continued in a statement. “Consequently, we have lowered our unsolicited sovereign ratings on France from AA-/A-1+ to A+/A-1,” it wrote. The outlook is stable.
Awaiting Moody’s Decision
“For 2026, the government submitted a budget draft on Tuesday, October 14th, which aims to accelerate the reduction of the public deficit to 4.7% of GDP while preserving growth,” replied the Ministry of the Economy. “This is a key step that will allow us to meet the