Yes, saying "Ferme la bouche" (literally meaning "Close your mouth") is considered quite rude, blunt, and aggressive in French conversational etiquette. It is roughly equivalent to telling someone bluntly to shut their mouth in English. If you want to ask someone politely to quiet down or stop speaking in a social setting, far more polite phrases include S'il te plaît, un peu de silence or Tu veux bien te taire ? in familiar contexts.
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