French Bond Yields Fall Despite Fiscal Concerns
France’s 10-year OAT yield fell to 4.9%, tracking renewed declines in oil prices despite persistent concerns over the country’s fiscal outlook. Oil prices retreated after reports suggested US President Donald Trump was willing to give diplomacy with Iran more time before considering renewed military strikes following Tuesday’s midterm elections. Meanwhile, Fitch Ratings revised France’s outlook to negative, citing deteriorating public finances, high government debt, elevated borrowing costs, weaker growth and political uncertainty. The agency expects public debt to rise from 115.7% of GDP in 2025 to 124% by 2028, while the budget deficit is projected to remain at 5.5% next year, above the government’s 5% target. Elsewhere, the ECB kept interest rates unchanged on Thursday. President Christine Lagarde confirmed that a rate hike had been discussed, but policymakers unanimously opted to hold borrowing costs steady, citing tighter financial conditions as a factor helping contain inflation.
France’s 10-year OAT yield fell to 4.9%, tracking renewed declines in oil prices despite persistent concerns over the country’s fiscal outlook. Oil prices retreated after reports suggested US President Donald Trump was willing to give diplomacy with Iran more time before considering renewed military strikes following Tuesday’s midterm elections. Meanwhile, Fitch Ratings revised France’s outlook to negative, citing deteriorating public finances, high government debt, elevated borrowing costs, weaker growth and political uncertainty.
The agency expects public debt to rise from 115.7% of GDP in 2025 to 124% by 2028, while the budget deficit is projected to remain at 5.5% next year, above the government’s 5% target. Elsewhere, the ECB kept interest rates unchanged on Thursday. President Christine Lagarde confirmed that a rate hike had been discussed, but policymakers unanimously opted to hold borrowing costs steady, citing tighter financial conditions as a factor helping contain inflation.