French 10-year bond yields hit 5%, highest since 2002
TLT•France’s 10-year government bond yield touched 5.002%, its highest level in 24 years, as investors grew more concerned about the country’s public finances. The premium over German bonds was around 157 basis points.
1. Yields reach 24-year high
France’s 10-year government bond yield touched 5.002% on Wednesday and was last just below 5%, up about 8 basis points on the day. The yield reached its highest level since 2002.
2. Pressure on French bonds
Investors demanded a premium of around 157 basis points to hold French bonds rather than benchmark German Bunds, nearing levels last seen in 2011. French bonds have faced pressure as a weakened government tries to pass a budget and reduce a high deficit, with next year’s contested election and widespread protests adding uncertainty.
