Economy

On October 23, 2026 Moody's kept France's sovereign rating at Aa3 with a negative outlook, against widespread expectations of a downgrade to A1, saying the rating assumes a 2027 budget that reduces the deficit and slightly easing social tensions, with the ten-year yield having passed 5.1% for the first time since 2002.

The extra yield investors demand to hold French rather than German 10-year bonds has jumped from about 55 basis points in February to the 130 to 140 range, driven by debt near 119% of GDP, a deficit near 5.4% and a fragmented parliament; a budget vote and rating review are due this month.

The ONS says GDP rose 0.7% in the three months to August, the eighth consecutive rise, but services were flat in the month, construction fell again and analysts warn higher energy prices could lift inflation.

Public-sector and education job losses, a sharp fall for young workers and the lowest participation rate in 29 years outside the pandemic left markets cutting bets on a rate rise, even as inflation runs near 3%.

The government's autumn projection credits exports and state spending, while inflation hit 3.3% in September and employment is falling, leaving business groups warning that debt-financed support has a short shelf life.

September labour force data show the highest jobless rate in about five years, with employment falling when economists expected a gain, just after the Reserve Bank lifted the cash rate to 4.60%.

The BLS says consumer prices rose 0.6% in September and 3.7% over the year, driven by energy, while core inflation held at 2.6% and motor vehicle insurance cost 5% less than a year ago.

The Monetary Authority of Singapore left the slope, width and centre of its exchange-rate band unchanged on October 14, saying inflation should ease significantly from mid-2027 as growth stays steady for now.

The BOJ's September 18 increase took its policy rate to a 31-year high, but two dissenters and a weak yen show how contested the next move could be when the board meets again on October 29-30.

India's central bank raised its policy rate by 25 basis points in a unanimous vote, its first hike since February 2023, citing inflation risks from oil near $100, a deficient monsoon and a weaker rupee.

APRA's March 2026 quarterly statistics, released May 28, show total superannuation assets of A$4,437.9 billion, down 1.0% on the quarter and up 7.9% on the year, with contributions up 11.3% and benefit payments up 12.3%.