France stripped of prized ‘AAA’ credit rating by Moody’s
France has suffered a serious blow to its economic credentials after being stripped of its prized AAA credit rating by Moody’s.
By Jonathan Russell
19 Nov 2012
The rating agency said France’s long-term economic growth had been hit by its inflexible labour market and low levels of innovation eroding its competitiveness and industrial base.
Moody’s also flagged up the country’s exposure to the continuing eurozone crisis.
It warned the “predictability” of France’s resilence of further shocks in the eurozone was diminishing while the country’s exposure to the highly indebted countries such as Spain and Greece was disproportionately high.
In a statement Moody’s said: “Further shocks to sovereign and bank credit markets would further undermine financial and economic stability in France as well as in other euro area countries.
“The impact of such shocks would be expected to be felt disproportionately by more highly indebted governments such as France.”