France's 30-year yield pauses near 2011 highs amid political risk
French bond yields slightly decreased on Wednesday after hitting multi-year highs due to political uncertainty. Opposition to Prime Minister Bayrou's budget cuts raised concerns about the government's stability, impacting investor confidence. Addi...
By Reuters |
ETMarkets.com
France's 30-year yield paused for breath on Wednesday after hitting its highest since 2011 amid political uncertainty, and as President Donald Trump's attempt to fire a Federal Reserve Governor raised concerns about the central bank's independence.
The prospect that France's minority government could collapse triggered a sharp selloff in French stocks and bonds on Tuesday after the main opposition parties said that they would not back a confidence vote which Prime Minister Francois Bayrou announced for September 8 over his plans for sweeping budget cuts.
The political turmoil in France added to worries in global bond markets about the independence of the Fed.
Fed Governor Lisa Cook will file a lawsuit to prevent Trump from firing her, a lawyer for Cook said.
The French 30-year yield edged 1 basis point lower at 4.38%, after hitting its highest since November 2011 on Tuesday.
The French 10-year yield was also 1 bp lower at 3.49%, having hit a five-month high on Tuesday.
German 10-year bond yield, the benchmark for the euro zone bloc, was 1.2 bps lower at 2.71%.
The gap between French and German 10-year yields, a gauge of the premium investors require to hold riskier French debt, was last at 77 bps, after jumping to more than 79 bps at one stage on Tuesday, its highest since April.
The gap between French and Italian spreads, which was more than 150 bps just two years ago, narrowed to 8 bps.
The prospect that France's minority government could collapse triggered a sharp selloff in French stocks and bonds on Tuesday after the main opposition parties said that they would not back a confidence vote which Prime Minister Francois Bayrou announced for September 8 over his plans for sweeping budget cuts.
The political turmoil in France added to worries in global bond markets about the independence of the Fed.
Fed Governor Lisa Cook will file a lawsuit to prevent Trump from firing her, a lawyer for Cook said.
The French 30-year yield edged 1 basis point lower at 4.38%, after hitting its highest since November 2011 on Tuesday.
The French 10-year yield was also 1 bp lower at 3.49%, having hit a five-month high on Tuesday.
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German 10-year bond yield, the benchmark for the euro zone bloc, was 1.2 bps lower at 2.71%.
The gap between French and German 10-year yields, a gauge of the premium investors require to hold riskier French debt, was last at 77 bps, after jumping to more than 79 bps at one stage on Tuesday, its highest since April.
The gap between French and Italian spreads, which was more than 150 bps just two years ago, narrowed to 8 bps.
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