The french ones of the french ones of the french ones. bonds They increased, reducing the spread over the safest German bonds – a four -week low -wise index – in the midst of optimism that the concessions made by the prime minister Sebastian They could help promote a budget and prevent a deeper political crisis.
The yield on the 10 -year French bond decreased by seven basis points to the lowest five -week level of 3.40%, reducing the premium against German bonds to 79 basis points – the lowest from September 16. The spread reached the high of 2025, over 89 basis points last week, following the unexpected resignation of Sebastian Lekorni before restricting the traffic after his re -establishment by President Emmanuel Macron, according to Bloomberg.
These moves were assisted by Lekorne’s indication that he is willing to sacrifice the reform of the pension system – one of Macron’s basic economic measures – in an effort to political stability. The Socialist Party, which plays a crucial role in the National Assembly, has previously stated that it will support the government in voting only if the pensions law is suspended and has not yet responded to Lecorne’s offer.
Legislators are going to discuss two censure proposals against the Lecorne government on Thursday (9.10.25), having already forced both of its predecessors – Michel Barnier and François Bairou – to resign because of their plans to limit what has become the largest. If the National Assembly expelled Lecorni later this week, Macron has told the ministers that this would be equivalent to a “dismantling proposal”, indicating that he could dismantle parliament and call for new elections.
“Political stability is more important for spread than medium -term fiscal risk”, said Théophile Legrandstrategic interest rate analyst at Natixis. “The question now is whether this will speed up France’s downgrade to A+ from S&P by the end of the year”.
S&P has evaluated France with AA- with negative prospects ahead of its next evaluation on November 28th. Moody’s, which maintains AA3 evaluation with steady prospects, has scheduled the next update on October 24.
A Barclays Plc basket that includes companies that are more exposed to domestic dangers in France has become positive, led by the profits of Societe Generale SA, the Vinci SA construction and the telecommunications provider Orange SA. The index won up to 1%, while the CAC 40 traded 0.1% lower, exceeding both the wider European Stoxx 600 reference index.