The governor of the Bank of France fears the country will be "suffocated" by its deficit.

"France is not at risk of bankruptcy, but of suffocation on several dimensions," François Villeroy de Galhau said on France Inter: "budgetary suffocation (...), economic suffocation (...) and generational suffocation because we are choosing seniors over young people," with "more retirement spending and more deficit."

To remedy this, he believes it is necessary to "move beyond posturing, quarrels, and spectacle, and find genuine compromises."

The governor deemed it "very important that there be a budget for 2026" with a public deficit "at a maximum of 5% of GDP" so as not to put themselves "in the red zone of danger".

This requires "stabilizing spending" and "being wise about taxes".

In this case, "recognizing that we no longer have money to lower taxes and that there are certain necessary justice measures," such as extending the corporate tax surcharge for large companies, on which right-wing and left-wing parliamentarians cannot agree.

Even though financial markets are currently calm with regard to France, "their functioning is never linear, (there) can be an apparent calm followed by a brutal correction," the governor observed, particularly "in the current extremely uncertain geopolitical environment."

He also stressed that "the US financial deregulation agenda increases the risks of a financial crisis", while calling for "keeping our calm and our course" in Europe, and for "maintaining a frank and demanding dialogue across the Atlantic".

Regarding the likely decrease in the interest rate on the Livret A savings account next Thursday, to reflect the decline in inflation, Mr. Villeroy de Galhau simply stated that the current rate of 1,7% "will remain significantly higher than inflation" (0,8%). Economists anticipate a reduction to 1,3% or 1,4%.

He finally asserted that "now is the right time" for a mortgage, with rates "averaging around 3,1% for a twenty-year loan." He revealed that, in the first eleven months of 2025, the amount of loans granted exceeded by 35% those granted from January to November 2024.