Moody's keeps France's Aa3 rating, Lecornu hails blow to 'declinist forecasts'

Moody's has maintained France's Aa3 credit rating with a negative outlook, defying expectations of a downgrade. The agency stated it took no credit action, assuming a 2027 budget reducing the public deficit will be adopted and social tensions will moderate. Prime Minister Sébastien Lecornu welcomed the decision on X as defying "declinist forecasts" from those speculating on French debt. Moody's noted its rating assumes a budget reducing the deficit to 5.2% of GDP, while rival agencies Fitch and S&P rate France lower at A+. Economists expressed surprise at the decision, with some calling it difficult to understand. French 10-year bond yields recently hit levels unseen since 2002, and the debt is projected to reach 121.7% of GDP by 2027. S&P's next decision is expected on November 27.