The rating agency rating, which was “AA +”, changed to “AA”. In the question, the “weak” economic prospects of the country.
Fitch lowers France’s rating due to budget slippage
Rating agency Fitch Ratings lowered France’s rating from “AA +” to “AA” on Friday, adding a stable outlook, notably due to slippage in the budget.
Fitch also described the country’s economic outlook as “weak” and said it weighed on the Thenewdominion payday loan consolidation and the stabilization of the debt ratio. “The French economy is expected to grow less than the average euro-zone country for the first time in four years,” said Fitch.
The agency believes that the government’s structural reform agenda “is not enough to reverse the negative trends that weigh on long-term growth and competitiveness. ” Fitch expects French gross domestic product (GDP) growth of 0.4% in 2014 and 0.8% in 2015, when “the depreciation of the euro and lower oil prices will support growth somewhat. ”
“The government is staying the course”
In a statement, the French Finance Minister Michel Sapin assured that “the policy is beginning to bear fruit since the companies benefit from the first effects of decreases in levies, which will continue in the coming years. ”
“In a difficult economic climate in Europe, the government is maintaining its course, with the implementation of the expected savings, with the continuation of the reforms needed to boost growth and make businesses more competitive,” Michel Sapin explains.
“We have a course, we keep it. We set our objectives in terms of deficit reduction. They were even reviewed to improve the results, whether in 2015, 2016 and 2017, ” added the government spokesman, Stéphane Le Foll.
3.6 billion euros in savings
Despite the savings measures of 3.6 billion euros announced by the government that will lead the 2015 deficit to 4.1% of GDP instead of 4.3% previously forecast, “it will not be enough to change the projections of Fitch on the dynamics of the public debt of France”, adds the agency.
Fitch also points out that at 4.1% of GDP, the deficit forecast for 2015 “shows no improvement over that of 2013”. The government is also projecting a deficit of 4.4% for 2014 instead of 3.8% expected in April.
“These latest deviations in fiscal targets … weaken fiscal credibility, ” the agency added, adding that “this is the second time since the end of 2012 that the French government has delayed the goal of reaching the deficit threshold of 3% “demanded by the European Union. The French government has pushed this target to 2017.