Ariel Bezalel of Jupiter Asset Management warns that France’s fiscal trajectory mirrors Greece’s path in 2010, despite key differences. While France remains an investment-grade borrower within the eurozone with central-bank backstops, Bezalel cites chronic indebtedness in both public and private sectors as a growing concern. He manages about $5.7 billion and has sold most French corporate bonds while shorting French government debt via futures.

French public debt reached €3.54 trillion, or 117.5% of GDP, in Q1, with projections rising to 121.7% by 2027. Private-sector debt is also elevated, with total borrowing at 324% of GDP, second only to Japan among major economies. The yield spread between 10-year French bonds and German bunds hit 1 percentage point, the widest since 2012.

Political gridlock and the upcoming 2027 French presidential election complicate fiscal consolidation. Standard Chartered and Raymond James Wealth Management have also raised alarms. Finance Minister Roland Lescure dismissed comparisons, noting Greece faced a 5% recession and 15% budget deficit, while France’s situation is less severe.

Analysts like George Goncalves of MUFG question how France can stem fiscal bleeding without political unity.