France's finance ministry has formally denied rumours that the country is heading for a downgrade of its top AAA credit rating.
The rumours sent the Paris stock market tumbling, though all three major ratings agencies have confirmed France's triple-A rating.
The announcement came hours after President Nicolas Sarkozy promised new measures to slash France's public deficit amid fears the country could be next after the United States to suffer a top credit rating downgrade.
The new French government measures will be decided on August 24, the president's office said after he broke off a holiday on the French Riviera to return to Paris to hold an emergency government meeting on the crisis.
'The head of state reiterated that the commitments to reduce the public deficit are inviolable and will be adhered to no matter how the economic situation evolves,' the Elysee said in a statement.
Finance Minister Francois Baroin said after today's meeting that the new measures would take into account 'global uncertainty' and the downgrading of the US rating by Standard & Poor's.
Sarkozy has asked his finance and budget ministers to come up with new ideas for sticking to France's deficit-reduction promises and these measures will be decided on on August 24, the president's office said.
The French public deficit is estimated at 5.7% of gross domestic product this year and the government has vowed to reduce it to 4.6% of GDP next year and to 3%, the EU limit, in 2013.
But the International Monetary Fund said last month that France would probably need extra action to cut its public deficit in 2012 and 2013 as falling growth threatened to make the targets more difficult to meet.
