France's 10-year yield hit 5% for the first time since 2002, and its spread over Bunds moved toward 160 basis points. With oil-driven inflation running hot, the European Central Bank has to weigh more rate hikes against its bond-market backstop.
Energy and mineral-oil products drove Germany’s fastest factory-gate inflation since March 2023, a cost shock former NBU governor Kyrylo Shevchenko flags as a competitiveness problem the ECB cannot offset with demand policy. Source
The yield on France's 10-year OAT (Obligation Assimilable du Trésor), the benchmark government bond, reached 5% on Wednesday, a level last seen in July 2002. Reuters had it at 5.00% by 10:07 GMT, up about 8 basis points on the day and 16 basis points on the week. Against German Bunds the spread is back near 160 basis points, within reach of early October's 158.67 basis points, the widest since November 2011. With the German 10-year yield at around 3.42%, the gap works out to roughly 158 basis points. Quoted spreads run from 150 to 160 basis points depending on source and timestamp.
