Against all odds, Standard and Poor’s raised on Friday the outlook of the rating of France, which passes from negative to stable, while maintaining its rating at ” AA “.
In a press release, the rating agency indicates that the upward revision of the perspective takes into account the progressive implementation of reforms to support the growth and ongoing fiscal consolidation. She stresses that, despite the persistence of fiscal risks, and on the growth, France has shock absorbing material.
” The economic recovery is on track, especially if the rebound in business investment is confirmed, and if employment growth accelerates “, she says. The agency underlines in particular ” reforms of the taxation and the labour code “, that should be ” of the stabilizing effects on employment, growth, competitiveness and the public finances “.
” Sign of confidence “
The minister of Economy and Finance Michel Sapin has determined that this upward revision was “a sign of the agency’s confidence in the economic outlook and the budget of the country “and that” the reforms paid “. “This decision strengthens the government in the merits of the orientation of its economic and fiscal policy. It will continue the consolidation of public accounts, the objectives of which were confirmed in the draft finance law for 2017, and will stay the course of reforms necessary to strengthen the French economic fabric “, he says.
moreover, the commission considers that this decision ” confirms the quality of signature of the French State, by classifying the debt of France among the safest in the world “. “This investor confidence is reflected by the borrowing terms and conditions extremely favorable to the State, but also for all economic players, businesses, like households “, added the minister.
“Our reforms to redress our economy, our attractiveness, without sacrificing our social model, pay. Continue !” he responded, for his part, Manuel Valls on his account Facebook.
A boon to the French budget
It is indeed a good new for France, which, under the effect of the action of the european central Bank, will be able to continue to borrow at historically low levels. The average rate of emission reductions in the medium and long terms completed since the beginning of the year to “student” only at 0 ,35 % … two times less than in 2015. A boon for the French budget, which has seen the burden of debt lightened of several billion. These exceptional conditions have also allowed Paris to raise debt on maturities of longer, further delaying the repayment schedule. The second loan to 50 years of the year has been completed at a cost of less than 1.5 %. And as in previous years, agence France trésor, responsible for placing debt with investors, has taken advantage of low interest rates to pre-finance to good account a portion of its needs for 2017 and 2018.
S&P had downgraded the last time the note of France, in November, 2013, from AA+ to AA, the third note in the scale, and it had revised its outlook from “stable” to “negative” in October 2014. The French government, which has reduced the public deficit to 3.5% of the gross domestic product (GDP) in 2015, 0.3 percentage point better than expected, reaffirmed its objective of a deficit to 3.3% this year and 2.7% in 2017 during the presentation of the draft finance law for 2017. It also anticipates that the debt goes from 96.2% of GDP in 2015 96.1% this year and 96.0%, respectively, in 2017.
The rating outlook of the Hexagon are now stable for the four main rating agencies are S&P, Fitch, Moody’s and DBRS.
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