France’s public debt reached €3,595.5 billion at the end of June, equal to 119% of gross domestic product. The ratio was 117.5% at the end of March, and the debt stock rose by €59.6 billion over the quarter. The new release puts the scale of government borrowing in view as France prepares its next budget.
Economics & Markets··Evening
Debt stock rises by €59.6 billion in a quarter
France’s national statistics institute Insee measured gross public debt at €3,595.5 billion at the end of June, equal to 119.0% of gross domestic product. Le Monde also reported the ratio reaching 119% at the end of the second quarter. The debt stock rose €59.6 billion from March, when its ratio to GDP stood at 117.5%. The figures measure outstanding liabilities at a quarter’s end, rather than the interest cost of fresh borrowing or a projection of future debt.[1], [2]
Central government makes up most of the increase
The central government’s contribution to the public debt stock grew by €53.0 billion during the second quarter. Its outstanding long-term negotiable securities increased €36.9 billion, while short-term securities rose €16.5 billion. Social security funds added €8.4 billion to their debt contribution. Local government debt moved in the opposite direction, falling €1.7 billion. These component changes do not each describe a new budget deficit: they show how the stock of gross debt was distributed across parts of general government at the June reporting date.[1]
Falling cash holdings widen the net-debt increase
General-government cash holdings declined €6.8 billion. Net debt, which takes relevant financial assets into account, therefore grew €68.2 billion to €3,366.8 billion, a larger rise than in gross debt. Its ratio to GDP increased from 109.7% to 111.4%. Insee cautions that quarterly debt figures use less complete accounting material than annual accounts and may be revised. It also says the change in debt stock alone cannot establish the quarterly deficit, because the measures differ in scope and seasonal adjustment.[1]
