Public debt exceeds 3.3 trillion at the end of September in France

France’s public debt further swelled in the third quarter, standing at 113.7% of gross domestic product (GDP) at the end of September compared to 112.2% at the end of June, INSEE said on Friday. From July to September, the debt increased by 71.7 billion euros, to reach 3,303 billion euros, said the National Institute of Statistics.

The increase in public administration debt is mainly due to the State, whose debt increases by 59.8 billion euros, to 2,690.5 billion after +70 billion in the previous quarter. That of the various central administration bodies (ODAC), described as “stable” by INSEE, nevertheless increases by 200 million euros to 69.4 billion.

The debt of social security administrations also increases (+10.4 billion after +4 billion), to 290.8 billion, as well as that of local authorities (+1.3 billion euros to 252.2 billion), then that it had fallen by 300 million in the second quarter. French public debt, which remained confined between 60% and 70% of GDP at the start of the 2000s, experienced an initial surge after the 2008 crisis, stabilized around 100% at the end of the 2010s, before a second meteoric restart due to massive spending by “whatever it costs” linked to the Covid health crisis.

The rating agency Moody’s lowered France’s sovereign rating

While the country is struggling in the political slump since the dissolution decided in June by Emmanuel Macron, the economy is slowed down by uncertainty. Last week, the rating agency Moody’s lowered France’s sovereign rating by one notch, to Aa3 – a surprise because the agency did so outside of its half-yearly schedule – in order to take into account the new uncertainties linked to the censorship of the government of Michel Barnier.