The international credit rating agency Moody’s announced on the night of Friday to Saturday that it is downgrading its public debt to Aa3 of Francejust a few hours after o Francois Bayrou was named the new prime minister by the president Emmanuel Macron.

The degradation “reflects our view that the public finances” of France “will weaken substantially over the coming years” due to “political fragmentation” which may “in the foreseeable future” to “prevent significant fiscal adjustment”argued the house.

Moody’s, which downgraded the outlook for France’s sovereign debt (Aa2 at the time) to negative in October, warned on the day of the no-confidence vote against Michel Barnier’s previous government on December 4 that it could have a “negative” impact. France has already been downgraded to corresponding levels by Fitch and S&P.

The house characterized the outlook as stable in the new assessment.

The Minister of Economy and Finance of France, Antoine Armand, noted through X that he “records” the decision of the international house.

“Moody’s has announced the change in France’s credit rating (…) highlighting the recent developments in parliament and the current uncertainty regarding the improvement of our public finances. I’m writing it down”the minister wrote.

“The appointment of François Bairou (as prime minister) and the reaffirmation of our will to reduce the deficit give a clear answer”he added.

In his short speech during the handover ceremony yesterday, Mr. Bayrou insisted on the need to reduce France’s deficit and debt.