French 10-year bond yield hits 5.1% as fiscal concerns mount, Groupama Asset Management says
TLT•TLT•TLT•TLT•France’s 10-year bond yield reached 5.1%, its highest since 2002, while the 10-year OAT-Bund spread widened to 170 basis points, Groupama Asset Management said.
Groupama Asset Management said France’s 10-year yield reached 5.1%, its highest since 2002, and the OAT-Bund spread widened to 170 basis points, compared with an estimated 90 basis points without current tensions. The firm cited political uncertainty and doubts over fiscal stabilization, and said volatility is expected to remain elevated.
The firm said eurozone contagion remains contained, despite Italian and Spanish spreads widening to 125 and 70 basis points, respectively. It said immediate default is not the main risk, but higher borrowing costs could reinforce investor distrust and further constrain France’s budget flexibility.
