Bad news for François Bayrou. While desperately looking for ways to complete France’s budget for 2025, the new prime minister finds himself faced with an impressive rise in interest rates, which further complicates the equation by increasing the debt burden, an expensive expense. OBLIGATORY. And this may just be the beginning, according to some economists.
From less than 2.9% per year on the eve of the appointment of François Bayrou to Matignon, on December 13, 2024, the rates demanded by international investors to lend to France over a ten-year term rose on the financial markets to nearly 3.45%, Friday January 10.
Forced to go into debt to cover its public deficit, the State must therefore pay interest at a level it has not seen since October 2023. Between the mid-1980s and 2020, these rates n had continued to decline, going from more than 10% to 0%. They even became negative for a while. But, with the end of the Covid-19 pandemic and the recovery of the global economy, the rates charged by banks have started to rise again. Particularly since the beginning of December 2024.
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