PARIS — The European debt crisis hit a troubling new note Tuesday when France was forced to defend its flawless credit rating — one of the few left among major Western economies — after Moody’s Investors Service warned that it was at risk from the Continent’s widening sovereign debt problems.  “We will do everything to avoid being downgraded,” Finance Minister François Baroin said on French television Tuesday.  Hours earlier, Moody’s said it might put France’s triple-A rating on watch for a possible downgrade within the next three months if slowing growth and the tab for supporting crisis-hit French and European banks strained the budget.  Moody’s said late Monday that the global financial and economic turmoil was making it more difficult for France to keep its government debt from growing, compared with other triple-A-rated countries. France’s debt was 82.3 percent of gross domestic product last year, a shade less than Germany’s.  The price that France pays to borrow on international financial markets compared with Germany rose to its highest level Tuesday since the euro was introduced in 1999. Rising borrowing costs are what pushed weaker countries, including Greece, Ireland and Portugal, to seek bailouts.  European leaders are scrambling to come up with a plan to ensure that the same does not happen to Spain or Italy. More financial problems in either of these economies would stretch the finances of big countries like France and Germany even further.  France’s top-notch rating has been under scrutiny since August, when another rating agency, Standard & Poor’s, downgraded America’s t credit rating. S.&P. said at the time that France, like the United States, needed to stoke growth and cut its debt.  While France’s accounts are still in better shape than those of many of its neighbors, they could deteriorate if the government provides significant financing to other European countries or to its own banking system in a bid to keep the euro crisis from spiraling. Such moves could give rise to significant new liabilities for the government’s balance sheet, Moody’s warned.  In fact, France, along with Germany, will wind up footing a large part of the bill for a €440 billion, or $605 billion, bailout fund, known as the European Financial Stability Facility. French banks may also wind up taking larger-than-expected losses on their investments in Greece. Investor nervousness about the health of BNP Paribas — which was downgraded late last week — and other French banks has prompted the government to declare it would pump taxpayer money into the banks if need be.  Concerns about the cost that banks might impose on France rose after Paris and Brussels agreed last week to backstop Dexia, a Belgian-French bank that had to be partly nationalized just three years after both governments gave it a multibillion-euro bailout following the collapse of Lehman Brothers.  President Nicolas Sarkozy has made it a priority to keep France’s top rating intact, especially headed into a heated campaign for the French presidency against his freshly crowned Socialist opponent, François Hollande — who, like Mr. Sarkozy, has vowed to cut France’s deficit to 3 percent of gross domestic product by 2013.  Mr. Baroin said France’s AAA rating was “not in danger” because the government was ahead of schedule in passing a spate of measures to reduce the deficit. However, he acknowledged that economic growth — which ground to a halt in the second quarter — would probably not meet the 1.75 percent target the government had set for 2012.  “It’s probably too high compared to the development of the economic situation,” Mr. Baroin said on French television.  The French prime minister, François Fillon, said Tuesday that a European leaders’ summit being held this coming weekend in Brussels would be pivotal to re-establishing confidence in the euro monetary union.  France’s economy will continue to grow next year “if we are capable of putting together measures in the next two weeks that are strong enough to stop the speculation,” Mr. Fillon said on French television. “If we fail, it will be serious because the whole world would risk entering a recession, and we would have to take new measures.”
The agency said it might place France on watch for a downgrade if the costs of supporting banks and other euro countries hurt the country's finances.