The contagion from France to other euro-area sovereign markets has been modest so far. Nevertheless, Italy displays budgetary risk, having debt forecast to rise to 143.6% of GDP by 2029, from the 137.3% as of end-2023. Germany remains an outlier among the G7, forecast for budget deficits of under 2% of GDP this year and the years ahead alongside declining debt.
UK Debt to Increase; Japan’s Credit Outlook Improves
Meanwhile, the UK is in similar position to that of the US in facing a significant rise in general government debt to 110% of GDP in 2029 from 101% in 2023. Memories of the mini-budget crisis two years before are unlikely on their own to be enough to ensure tight fiscal policy after parliamentary elections.
Scope Ratings recently revised its Outlook of another G7 sovereign state: Japan (rated by Scope A) to Stable, from Negative,…
Read More
