France Is Replacing Italy as Europe’s Poster Child for Fiscal Woe

France’s prolonged political crisis has turned the country into the euro area’s fiscal flash-point, taking over a role long played by Italy.

The shift was thrown into sharp relief on Friday when France suffered its second sovereign downgrade in a week, just as Italy won its first upgrade from Fitch Ratings since 2021. The gap between them is narrowing, according to that company’s assessment, which now puts the countries just three notches apart.