Hong Kong (PRWEB) November 22, 2011
France, this past Monday, experienced a significant percentage increase in its borrowing costs to a level almost double that of Germany. One French economist and adviser to French President Nicolas Sarkozy, Jacque Attali, commented in the newspaper La Tribune saying, ?Let?s not delude ourselves: In the markets, French debt is already not AAA.? Since France, along with Germany, are the main factors of the euro zone stability fund arranged to deal with Europe?s debt crisis, InvestTechFX reports that a change in France?s credit rating could threaten the entire plan.
Investor concern over French debt load and annual budget deficit are mainly responsible for higher yields on French bonds. While the French government steadfastly maintains that it has the ability to repay its debts, the French budget deficit is currently more than double the limit imposed in the 17 nation euro zone.
An analyst with Assya Compagnie Financiere, a French private equity and venture capital firm, Marc Touati, had this to say about France?s AAA credit rating: ?The question is not if France will be downgraded the question is to know when France will be downgraded.?
A preview of the implications of downgraded credit was presented to France last Thursday when an alert issued by Standard & Poor?s went out to some clients that France?s credit rating had already been reduced. The alert had been issued in error, but in the 1