Already in poor shape, public finances could well be one of the other collateral victims of the conflict in the Middle East. At the beginning of April, the Ministry for Public Action and Accounts drew up an initial assessment of the impact of the war, which notably highlights its effects on the debt burden.
Corresponding to all government spending devoted to paying interest on its debt, it has, like France’s debt itself, been steadily increasing for years. And the war could well aggravate this trend. According to the ministry, an increase of €3.6 billion is expected for 2026 alone, or nearly €300 million more per month.
If the debt burden is particularly affected by the war, it is because it is closely linked to the inflation that results from it. Faced with the specter of an inflationary shock, central banks may choose to raise their key interest rates in an attempt to slow it down. These rates shape the interest rates at which commercial banks lend to their customers, but also the rates…
