France's government fell: Financial crisis threatens!

France's government fell: Financial crisis threatens!

France faces financial challenges, which now also affect its creditworthiness. The rating agency Moody’s has downgraded the country and reduced the evaluation from AA2 to AA3, which means that the creditworthiness is now three stages below Germany, whose rating is awarded the top grade AAA. This decision came immediately after the government's fall under Prime Minister Michel Barnier, who was deducted in the dispute over planned austerity measures. The French parliament had tried to reduce the state deficit from 6.1 percent to 5.0 percent, which, however, met with massive rejection, as n-tv

political fragmentation in France, where none of the parties have an absolute majority, means that the prospects for household consolidation are dark. According to Moody’s, the likelihood that future governments can significantly reduce the deficit to be classified as low. Additional difficulties arise from the enormous public debt, which far exceeds the EU rules of a maximum of 60 percent with 112 percent of gross domestic product (GDP). This is the highest value in Europe and is far above the guidelines of the Union, such as Merkur With a deficient state budget and an unclear financial policy, investors must now accept higher interest rates for French government bonds in order to compensate for the additional risk. France's financial insult is further difficult by the lack of a stable budget, since a transitional law is required to regulate expenses up to a stable solution. Investors are thus increasingly concerned about the long -term solvency of the country.