PARIS, Sept 11 (Reuters) - France's economy will grow less than expected this year, but the outlook for next year remains steady, Finance Minister Roland Lescure said on Friday, raising prospects that hitting this year's deficit target could be more difficult.
The degraded outlook complicates the government's task of getting its 2027 budget passed in the coming months in France's deeply divided parliament, where parties have hardened their positions before a April-May two-round presidential election.
Lescure told journalists he was lowering the government's 2026 growth forecast to 0.5% from 0.7% previously, but stuck with a projection of 1.0% for next year.
"This year has been marked by extreme crises involving four different types of shocks," French Finance Minister Roland Lescure told reporters.
Slower growth will make it more difficult for the government to trim its fiscal budget deficit as planned to 5.0% of economic output this year.
"We are operating under tight budgetary constraints; there is no more fat to trim," Lescure said.
The economic fallout from the war in the Middle East, a succession of summer heatwaves and drought that hit agriculture output have dragged down growth and put the government's fiscal targets out of reach.
Further complicating the picture, French borrowing rates have surged in recent weeks as investors have identified France as one of the weaker links in a global bond selloff due to its weak public finances and serial slippage on its deficit-reduction plans.
(Reporting by Leigh Thomas; additional reporting by Ingrid Melander and Dominique Vidalon; Editing by Makini Brice)
