French Central Bank Governor warns of debt pressure
France's central bank governor, Emmanuel Moulin, pointed out that France is facing the risk of a financial squeeze due to rising interest rates caused by increasing public debt, which totaled approximately €3.59 trillion as of the end of June. This situation further elevates debt servicing costs. Concerns are intensifying as the yield on French 10-year government bonds rises to around 4.9%, amid a proposed budget that predicts a deficit of 5.4% of GDP for 2027. This has sparked market worries and increased debt burdens. Prime Minister Élisabeth Borne faces broad parliamentary opposition to the budget plan, which aims to cut spending and raise taxes, amid rising living costs and soaring energy prices. These factors highlight the risks of ongoing public debt and its potential impact on France's economic stability.
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