Overview
- This week Finance Minister Roland Lescure acknowledged the government is unlikely to fully hit its 5%-of-GDP deficit target and said officials will try to get as close as possible to that goal.
- Official data show public debt near €3.5 trillion, above 115% of GDP, leaving France the only major euro‑area state that has not trimmed its post‑pandemic debt burden.
- Auditors at the Cour des Comptes and rating firms like Moody's say interest payments are rising fast and could reach about €100 billion by 2029, which would make debt harder to stabilise.
- Bond markets are reacting with wider OAT‑Bund spreads and firms such as Morgan Stanley have advised clients to cut exposure to French debt because higher yields raise refinancing costs.
- With a fragmented parliament and the 2027 presidential contest approaching, analysts say passing the deep spending cuts or tax changes needed to stop a 'snowball' effect will be politically difficult and will be watched closely by the European Commission.