S&P Global Ratings has downgraded France’s sovereign credit rating from AA- to A+, citing persistent uncertainty over the country’s public finances despite the recent presentation of its 2026 budget proposal.
It is the second downgrade in 18 months, coming just weeks after Fitch lowered France’s rating in September. The decision underscores mounting pressure on President Emmanuel Macron’s government to rein in spending as debt and deficit figures continue to climb.
Economy Minister Roland Lescure acknowledged the downgrade, reaffirming the government’s target to reduce the deficit to 5.4% of GDP in 2025. The finance ministry defended the 2026 budget as a “key step” toward cutting the shortfall to 4.7% and meeting the longer-term goal of bringing it below 3% by 2029, in line with EU fiscal rules.
However, S&P warned that without further measures, France’s fiscal consolidation would likely remain slower than expected. The agency projects gross public debt to reach 121% of GDP by 2028, up from 112% in 2022.
France’s borrowing costs have already risen sharply amid investor concern over its fiscal trajectory and political instability. Debt repayments are expected to total around €55 billion in 2025, a figure likely to increase if interest rates remain high.
With the new A+ rating, France now stands on a par with Spain, Japan, Portugal, and China. The downgrade may translate into higher borrowing costs as markets demand greater returns to hold French debt.
The next major review of France’s credit standing is scheduled for 24 October, when Moody’s will issue its updated assessment.
