France's debt is now almost as big as its whole economy. The new boss of France's central bank didn't try to soften that.
Emmanuel Moulin told French lawmakers Wednesday that the debt picture is "not catastrophic, but serious."
Moulin, Macron's former chief of staff, made the comment at his confirmation hearing in Paris.
France is aiming for a budget gap of about 5% of GDP this year. That is nearly double the EU's 3% cap.
The country has missed its own targets for years. The reason: cutting spending is a political minefield in Paris.
Past French governments have lost power over those same fights, with strikes and street protests greeting nearly every reform plan.
A 115% debt-to-GDP ratio means France owes more than it makes in a year. Only a few big economies carry that kind of weight, like Japan, Italy, and the U.S.
The catch: the next French president takes office in April 2027. Far-right leader Jordan Bardella has a real shot at winning.
He has floated ideas like having the ECB buy up French debt. That would push the ECB's mandate to its limit.
A mandate is the set of rules a central bank has to follow. The ECB's main job is to keep prices stable.
That gets hard when a big member state's debt path looks shaky.
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A debt scare in Paris does not stay in Paris. It spreads to the euro and to bonds across the bloc.
French bond yields - the rate a bond pays - tend to set the floor for southern Europe.
As governor, Moulin will sit on the ECB's rate-setting council. So the man flagging the risk will help decide how to react.
He is also a veteran crisis hand. He helped Nicolas Sarkozy through Europe's debt crisis.
He also worked with Christine Lagarde, now the ECB chief, back when she ran France's finance ministry.
That track record cuts both ways. Markets will trust him on calm calls.
But they will lean on him hard if Paris stumbles, since investors get nervous when central bank ties to a sitting president look this close.
Moulin would not yet commit to a stance at the ECB's June 11 meeting. He said he is watching three things.
Those are inflation outlook, core inflation, and wages. And if the Middle East energy shock lasts, he said the ECB will need to act.
The bigger test for France is whether this government can narrow the gap. Past efforts have stalled out under political heat.
There is also the risk that bond markets push back if the gap gets worse. A bond market push back means yields jump and borrowing costs rise.
That has happened in France before, and it would happen faster this time. So the man warning about the debt is now the one helping decide what to do.
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