French Debt: Risk Premium Rises to 78 Basis Points Compared to Germany
OAT at 3.79%: A Spread Exceeding Its Monthly Average by Over Ten Points
The 10-year French government bond is trading at 3.79%, compared to 3.90% the previous day, marking a decrease of 11 basis points for the session. The German Bund, which serves as the risk-free benchmark for the eurozone, stands at 3.01%.
The spread between the two instruments is thus 78 basis points, an improvement of 5 basis points from Monday's level. However, this figure remains significantly above the 30-day moving average of 67.8 basis points, representing an excess of 10.2 basis points over this benchmark.
A review of the recent historical data confirms an upward trend in the spread since mid-March: starting from 59 basis points at the end of February, the gap progressively increased to reach 83 basis points on Monday, March 23, its highest level during the observed period, before slightly receding today.
A structurally drifting risk premium, far from the 2011 peaks but the highest in a month
The widening of the OAT/Bund spread indicates increased vigilance from bond markets regarding French public finances. Within a month, the spread has risen by nearly 20 basis points, moving from a comfort zone around 59-63 basis points to levels close to 80 basis points, a symbolic threshold that had not been sustainably breached in recent weeks.
For reference, the OAT/Bund spread peaked at 225.1 basis points on November 17, 2011, at the height of the European sovereign debt crisis. Therefore, the current level remains far below those historical extremes, but the heightened tension signal indicated by market indicators underscores that France's fiscal path continues to be closely monitored.
In the equity markets, daily fluctuations remain modest and do not reflect a significant risk-off movement: the CAC 40 is up by 0.28% at 7,747.65 points, while the DAX is slightly down by 0.10%. The lack of strong correlation between stocks and bonds suggests that the bond market tension is more idiosyncratic—specific to France—rather than indicative of a widespread risk aversion in the eurozone.
This content has been automatically translated using artificial intelligence. While we strive for accuracy, some nuances may differ from the original French version.
