France Seeks Balanced Budgets Before Bonds

PARIS -- The sale of euro-zone bonds is a possibility after the budget policies of the different countries of the euro zone converge, said French Budget minister Valerie Pecresse said Thursday.


However, before considering the creation of euro-zone bonds--sovereign debt backed mutually by all the euro-zone countries--governments must first pass budget "golden rules" limiting deficits, reduce their deficits and reform their budgets to make them sustainable, Pecresse said in a interview with local TV station LCI.

The Budget minister reiterated French banks have no solvency problems and she stressed the ratings of the country's banks BNP Paribas SA (BNP.FR), Credit Agricole SA (ACA.FR) and Societe Generale SA (GLE.FR) are among the highest in Europe even after Moody's Investors Service downgraded Societe Generale and Credit Agricole.

Regarded the French economy, Pecresse said the government has received contradictory signs about the country's economic growth in the third quarter. She added a recession is not a scenario expected by the government.