French 10-Year OAT Near 14-Year High Amid Political Deadlock

2025-10-07 08:39 By Dongting Liu 1 min. read

The yield on the French 10-year OAT hovered around 3.59%, near the 14-year high it reached at the end of September, amid ongoing political paralysis.

The shortest-serving PM in France’s Fifth Republic, Sébastien Lecornu, abruptly resigned, and President Macron tasked him with conducting two days of “final negotiations” with various parties to find a way forward.

President Emmanuel Macron may attempt to form a new cabinet for parliamentary approval, but he is likely to face strong pressure to dissolve the National Assembly and call fresh legislative elections.

Meanwhile, rating agencies have issued fresh warnings on France’s sovereign credit.

Fitch warned that political uncertainty limits the scope for meaningful fiscal consolidation, and that failure to implement such measures—or a persistent rise in financing costs—could put downward pressure on the country’s credit rating, while S&P Global highlighted that passing a budget remains the government’s most pressing challenge.



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