France cannot afford to ignore the third credit-rating reduction in less than a year, French Minister of Finance Roland Lescure said.
“Three agencies have downgraded us and we can’t ignore this cloud,” he told Franceinfo on Saturday, speaking just hours after S&P lowered his country’s credit rating to “A+” from “AA-” in an unscheduled move.
“Fundamentally, it’s an additional cloud to a weather forecast that was already pretty gray. It’s a call for lucidity and responsibility,” he said, adding that this is “a call to be serious.”
Photo: AFP
The credit assessor’s move means France has lost its double-A rating at two of the three major credit firms in little more than a month, potentially forcing some funds with ultra-strict investment criteria to sell the country’s bonds.
The downgrade caps a week that saw French Prime Minister Sebastien Lecornu suspend President Emmanuel Macron’s flagship pension reform to stay in office, allowing him to survive a no-confidence motion.
`That brought some respite from a political crisis that came close to another government collapse and triggering snap elections. However, it is unclear what budget would emerge from a parliamentary debate where opposition lawmakers have more leverage to push back against spending cuts and tax increases.
“I’m not deciding the outcome of the match before it’s been played,” Lescure said. “This debate starts on Monday in committee and continues to the end of the year. It’s really up to us, and when I say ‘us’ it’s both the government and the parliament who need to convince observers — rating agencies and financial markets.”
France’s political and fiscal challenges since Macron called elections in June last year have triggered sell-offs of French assets, driving up the country’s borrowing costs. The French-German 10-year bond yield spread — a key measure of risk — rose more than 85 basis points over the past few weeks, from less than 50 before the snap vote.
The premium has narrowed to about 78 since Lecornu survived last week’s no-confidence votes.
“We have submitted a draft budget for 2026 that aims to accelerate the reduction of the deficit to 4.7 percent of gross domestic product, while we are at 5.4 percent this year,” Lescure said. “We are putting in place a budget that allows us to get there, but this budget must be passed in a vote.”
Next year’s fiscal shortfall is just a “first step,” he said. “The absolute objective is below 3 percent of GDP in 2029, and that will allow us to stabilize debt. Of course, that will require efforts, and that’s what S&P is telling us.”
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
Chinese entrepreneur Frank Gao used to spend long hours running his social media accounts but now outsources the chore to artificial intelligence (AI) agent tool OpenClaw, which is taking China by storm despite official warnings over cybersecurity. OpenClaw, created in November by an Austrian coder, differs from bots such as ChatGPT because it can execute real-life tasks such as sending e-mails, organizing files or even booking flight tickets. “Since January, I’ve spent hours on the lobster every day,” Gao said in an interview, referring to OpenClaw’s red crustacean mascot. “We’re family.” After downloading OpenClaw, users connect it to artificial intelligence models of their
At a massive shipyard in North Vancouver, Canadian workers grind metal beams for a powerful new icebreaker crucial to cementing the country’s presence in the increasingly contested arctic. Icebreakers are specialized, expensive vessels able to navigate in the frozen far north. And “this is the crown jewel,” said Eddie Schehr, vice president of production at the Seaspan shipyard. For Canadian Prime Minister Mark Carney, who heads to Norway next Friday to observe arctic defense drills involving troops from 14 NATO states, Canada’s extreme north has emerged as a strategic priority. “Canada is and forever will be an Arctic nation,” he said ahead of
RSS