France at Risk of Missing Deficit Target as Growth Forecast Cut

France is at risk of failing to meet its deficit-reduction target for 2026 as the economic outlook weakens, Finance Minister Roland Lescure told lawmakers in a mid-year update on public finances. The government cut its growth forecast to 0.7% from 0.9%, citing a weak start to the year and the impact of the conflict in Iran. Slower growth is depressing tax revenue while the government has had to provide targeted support to sectors hit by higher energy costs. Lescure acknowledged that the target of a public deficit at 5% of gross domestic product is now difficult to achieve, saying the government would try to get as close as possible. Budget Minister David Amiel said an additional 3 billion euros of spending cuts or freezes would be needed to offset unplanned expenditure, on top of 6 billion euros in earlier emergency measures, while the finance ministry identified a potential 2 billion euro overshoot from local government spending. The strain complicates preparation of the 2027 budget, due in September, amid concern that France's 3.5 trillion euro debt burden could keep rising ahead of the presidential election. A separate report commissioned by Lescure projected the deficit could widen toward 7% of GDP by 2030 without corrective action, with public debt climbing above 130% of GDP.