The spread between French 10-year OAT and German Bund yields reached 137.4 basis points at Friday’s close, up from 104 basis points on 22 September. The 10-year OAT closed at 4.79 percent and the Bund at 3.42 percent. Political unrest in France is adding pressure to the country’s sovereign debt.
Protests and the budget
On Saturday 17 October, the Interior Ministry counted 550,000 demonstrators, while the CGT put the figure at 800,000. The ministry reported 2,397 arrests and 997 injured police and gendarmes, seven of them seriously. A death was reported in Paris, where the cause was described as a cardiorespiratory arrest in unknown circumstances.
The National Assembly is scheduled to vote on the revenue part of the 2027 budget on Tuesday 20 October. The bill includes a flat tax of 31.4 percent on conversions of cryptocurrency into MiCA-compliant stablecoins from 1 January 2027, under amendment I-3898 adopted in plenary on 16 October. The 2027 budget targets a deficit of 5.0 percent of GDP, compared with 5.4 percent in 2026.
Political pressure on the bill
Presidential candidate Raphaël Glucksmann said that if the text does not move, there will be censure. The 2026 budget was rejected 404 to 1 in November 2025.
Related: French-German bond spread widens to 142 basis points · Indonesia's 10-year SBN yield spread narrows to 188 basis points
