Overview
- Banque de France governor Emmanuel Moulin said on Friday, September 11, 2026, that Jean‑Luc Mélenchon’s proposal to cancel roughly 18% of France’s public debt is “illegal, dangerous and useless.”
- ECB President Christine Lagarde publicly called cancelling central‑bank‑held debt a “pure violation” of EU treaties, signaling rejection from the eurozone’s key monetary authority.
- European legal specialists cite Article 123 of the Treaty on the Functioning of the EU as a major legal barrier to any unilateral cancellation of debt held by a national central bank.
- Markets have shown strain with French 10‑year yields near 4.44%, German yields near 3.50% and the France‑Germany spread at about 0.94 percentage point, the widest since 2012.
- The proposal remains a high‑profile campaign plank but faces steep legal, institutional and market obstacles and would likely prompt a Court of Justice of the EU ruling if pursued, with likely effects on inflation and borrowing costs for French households and the state.