Moody's issues warning on France with 'negative' outlook
Moody's has changed France's credit outlook from "stable" to "negative" while maintaining the Aa3 rating, due to political fragmentation and delayed economic reforms.
- Economy
- DPA
- Published Date: 10:36 | 25 October 2025
US ratings agency Moody's has maintained France's sovereign rating at Aa3 but has lowered the outlook from "stable" to "negative," threatening a possible downgrade of the country's creditworthiness.
S&P had already carried out a downgrade of France a few days ago, and Fitch downgraded its rating from AA- to A+ in mid-September.
Moody's justified the move by citing France's increasing political fragmentation and the resulting risks to stable financial policy.
Additionally, delayed reforms, such as those concerning pensions, could weaken the economy's growth potential.
The decision signals caution but spares the heavily indebted country from a direct downgrade, which would increase the interest burden on government bonds.
France has the highest debt in the European Union, amounting to around €3.3 trillion ($3.84 trillion). Measured against economic output, the debt ratio is 114%, the third highest after Greece and Italy.
Government spending is also among the highest in Europe. There are long-standing concerns that France could slow down Europe's already weak economic development.