Rolling coverage of the latest economic and financial news The global bond market appears to be steadying this morning. UK government bond prices are recovering some of their recent losses, which is pulling down borrowing costs (yields). “We remain Attractive on fixed income and see the rise in European yields as creat
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. Turmoil in the government bond market is reviving memories of the eurozone debt crisis 15 years ago – but this time France is in the firing line. Concerns over Paris’s fiscal position are pushing its borrowing costs up, amid a global sell-off of sovereign debt. This pushed the gap between France and Germany’s borrowing costs, a key measure of investor concern, to its widest level since 2012. Yesterday, the yield on French 10-year government bonds (or OATs) yields jumped to their highest level since 2002, before dipping back as the bond rout eased. Investors are reluctant to eat their OATs due to political uncertainty, with presidential elections scheduled for 2027, and concerns over France’s public debt which has climbed to a record high. Jim Reid, Deutsche Bank strategist, points out that yesterday the Franco-German 10 year spread (+13.9bps) saw its biggest daily jump since Marc