Overview

• Moody's has shifted France's credit outlook from stable to negative, citing the country's inability to curb its budget deficit and debt levels.
• France's credit rating remains at Aa2, supported by its large and diversified economy, but faces potential downgrades if fiscal issues persist.
• The French government plans to cut public spending by 60 billion euros in 2025 to reduce the deficit from 6.1% to 5% of GDP.
• Political fragmentation and instability in France are hindering effective budgetary reforms, raising concerns about future fiscal consolidation.
• The decision follows similar moves by Fitch and comes ahead of a review by Standard & Poor's, highlighting ongoing fiscal challenges.