France’s hung parliament complicates policymaking, rating firm S&P warns

France’s hung parliament is likely to complicate policymaking in the country, credit rating agency S&P Global said on Monday, as it warned sustained weakness in economic growth could see its rating cut again.

France now faces a hung parliament and difficult negotiations to form a government, after a surprise left-wing surge in parliamentary elections on Sunday blocked Marine Le Pen’s quest to bring the far right to power.

“Our ‘AA-/A-1+’ sovereign credit ratings on France would come under pressure if economic growth is materially below our projections for a protracted period,” S&P said in a note on the election outcome.

“Or if France cannot reduce its large budget deficit and if general government interest payments, as a share of government revenue, increase beyond our current expectations.”

Via Reuters