S&P cuts France’s credit rating by one notch

Standard & Poor’s lowered its long-term foreign and local currency sovereign credit ratings on the Republic of France today by one notch to AA from AA+.

S&P said high unemployment is weakening support for further significant fiscal and structural policy measures, adding that French government macro-economic reforms will not substantially raise the country’s medium-term growth prospects.

S&P also revised France’s sovereign credit outlook up to stable from negative.

It said the “stable outlook reflects our expectation that the government is committed to containing net general government debt, and that the probability of a further rating action on France over the next two years is less than one-in-three.” (Reuters)