New York’s S&P Global trims France’s outlook to “Negative” amid rising budgetary risk

• Financial

On Friday, the New York-headquartered rating agency S&P Global Inc had slashed France’s sovereign debts outlook to “Negative” from a previous “Stable” citing a growing budgetary risk. In the matter of the fact, latest move from S&P Global Inc came against the backdrop of a forecast from the Finance Ministry of France made earlier in the year, while the French Finance Ministry had predicted that the 27-member bloc’s second-largest economy would grow by 2.7 per cent this year, however, French economy would slow by 1.0 per cent in 2023.

Nevertheless, S&P Global Inc’s latest rating had echoed the views of French Finance Ministry, as the New York-based rating agency was quoted saying that simmering evidences are blazing over the horizon that the French economy has been struggling to fuel up its bottlenecked public finances, which eventually had resulted in a reduction of fiscal spaces.

S&P Global slashes France’s credit rating to “Negative”

On top of that, latest downgrade from S&P Global Inc came forth as the French economy has already been languishing lavishly under a massive load of general Government debt, while an implementation risk is associated with its structural overhaul as well.

Besides, S&P added at its report that a wider economic slowdown across the French economy is expected, as ECB policy tightening would likely to add further drag. In tandem, the French Government had warned on September this year that the Government’s public debt could rise above a whacking 111.5 per cent, while the Government also forecasted that its public debt might continue to rise until 2026.

Amid such rancorous outlook, S&P Global Inc had slashed France’s sovereign credit rating to “AA/A-1” from a previous “Stable”.