Egan-Jones' downgrade du jour: France

Egan-Jones says the social policies of French President Francois Hollande could jeopardize the nation's credit.

Another day, another downgrade in Euroland.

Egan-Jones lowered France's credit rating one notch to "BBB" from "A" on Thursday.

The ratings agency pointed to France's rising debt and slowing economic growth. It also warned that France is fond of subsidizing its banks, which could prove costly for the government.

In a subtle turn of phrase, Egan-Jones summed up the situation in France thusly: "Disastrous trend and the worst has yet to come."

While France has been able to borrow at affordable rates in the bond market throughout the crisis, Egan-Jones expects investors to begin demanding higher interest rates to lend money to Paris.

That could make it harder for Francois Hollande's Socialist government to make good on its campaign promises, the report said. Hollande has pledged to roll back the retirement age and raise the minimum wage, among other politically expedient policies.

The move comes one day after Egan-Jones downgraded The Kingdom of Spain. A few hours later, Moody's announced its own downgrade of Spain, without mentioning the kingdom part.