Downgrade UK not France, says French central bank boss

The head of the Bank of France has attacked the UK’s AAA-rating and called for it to be downgraded – as expectations increase of a downgrade to France’s rating.

Christian Noyer said ratings agencies should start with the UK if they are going to downgrade any AAA-rated countries.

He said the UK has “bigger deficits, more debt, higher inflation, and less growth than us [France]”, according to an FT report.

He blasted the ratings agencies as “incomprehensible and irrational” for threatenining to downgrade France, adding it would “not be justified based on economic fundamentals”.

However, four French senior government members have hinted a downgrade is on the cards this week.

President Nicolas Sarkozy has described a loss of the top rating as “not insurmountable” while François Fillon, the prime minister, said France would face “more jolts” amid the ongoing eurozone debt crisis.

Earlier this month Standard & Poor’s put 15 eurozone members, including France, on negative watch while Britain’s AAA-rating is not under threat.

 

This article was first published on Investment Week

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