Rating businesses warn subsequent authorities | EUROtoday

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Already underneath shut surveillance by ranking businesses earlier than the dissolution of the National Assembly, determined by Emmanuel Macron, on June 9, France has simply obtained a transparent warning from two of them, now that the election result’s recognized. Moody's and Standard & Poor's (S&P) every revealed, on Monday, July 8, an evaluation warning of the dangers of an extra downgrade of the nation's credit standing.

S&P, which downgraded France's ranking from third stage (AA) to fourth (AA−) in May, notes that the shortage of a majority within the National Assembly dangers inflicting financial stagnation: “We anticipate that the incoming government will struggle to pass meaningful measures and will face the ongoing risk of a motion of no confidence.”

The company fears that development, which it had forecast to extend this yr, “be significantly under [ses] forecasts for a long period »or “France doesn’t [parvienne] to not cut back its giant funds deficit”or that its interest rates increase sharply. So many scenarios that “would put stress on” on the French note.

“A severe danger on the invoice”

Moody's, for its part, warns of a potential elimination of the pension reform or other economic reforms implemented since 2017. This could “have a significant negative medium-term effect on France’s growth potential and its budgetary trajectory”the agency emphasizes. The Minister of Economy and Finance, Bruno Le Maire, agrees: “There is a severe danger to France's ranking”, if the reforms were abandoned.

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For the time being, monetary markets proceed to react calmly. The unfold between French and German charges, which was 0.5% earlier than the dissolution and reached 0.85% after the announcement, has fallen again to 0.65%.

https://www.lemonde.fr/economie/article/2024/07/10/les-agences-de-notation-mettent-en-garde-le-prochain-gouvernement_6248340_3234.html