France’s Bond Crisis Deepens
Investors are heading for the exit as France's bond crisis deepens and political gridlock sets in. Georgia Hall explains. (Source: Bloomberg)
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Investors are heading for the exit as France's bond crisis deepens and political gridlock sets in. Georgia Hall explains. (Source: Bloomberg)
French government bonds deepened this week’s slump, with investors demanding the biggest yield premium to hold the bonds over safer German debt since the region’s debt crisis. Huw van Steenis, Partner at Apollo, discusses this as well as the overall European economic outlook. (Source: Bloomberg)
France’s bond market is heading into a period of heightened volatility as political uncertainty collides with deteriorating public finances, according to Nicolas Forest, chief investment officer at Candriam.
A selloff in global debt has fueled a rout that’s hitting harder and faster in France than anyone expected, with nerves fraying about missed deficit targets and policy gridlock. The US jobs report is set be a macro highlight at a time when resilient data are supporting riskier assets while giving the Federal Reserve room to tighten policy to fight inflation. Economists estimate the reading will show nonfarm payrolls rose 90,000 last month after climbing in August by the most since March. The Opening Trade has everything you need to know as markets open across Europe. With analysis you won't find anywhere else, we break down the biggest stories of the day and speak to top guests who have skin in the game. Hosted by Anna Edwards, Guy Johnson and Tom Mackenzie. (Source: Bloomberg)
French pensioners will be among those expected to contribute to balancing the government's books, according to the 2027 draft budget unveiled on Thursday. Pensions exceeding 1,260 euros per month will be partially frozen and the cap on the 10% income tax deduction will be lowered, measures that received mixed reactions from pensioners.
France proposed that European countries and member nations of the International Energy Agency release 100 million barrels of diesel and crude oil, a step that’s aimed at placating the Trump administration as it pushes Brussels to do more to cut fuel prices.
The French government is seeking €54 billion in savings in its 2027 budget proposal, as it faces pressure over its ballooning public debt. But it's likely to face opposition, especially on proposals that would cap pension increases. Meanwhile, protests by high school students over resources and conditions in classrooms have spread across the country, with the budget likely to further inflame tensions.
As global government bonds wrapped up their worst quarter since 2024 due to higher oil prices and the threat of sticky inflation for the world economy, France is facing a particularly tricky trajectory. OAT-Bund spreads widened sharply as an increasingly fragmented government unveiled plans to narrow the nation's budget deficit, stoking investor concern over the country’s debts. The Opening Trade spoke to guests about the economic outlook and investment landscape for France as the nation grapples with growing global and domestic pressures on it's finances. (Source: Bloomberg)
Worries are mounting and bonds, stocks and the euro are taking the hit.
With looming elections and a draft budget that aims to address a €305.7bn financing requirement, French households are increasingly in the red. Will wages ever manage to outpace energy inflation?
France presented its 2027 budget bill on Thursday, seeking to enact unpopular belt-tightening measures that can lower its deficit and appease increasingly twitchy bond investors ahead of next year's presidential election. The legislation faces a tough ride in a deeply divided parliament, as political clans position themselves for one of the country's most consequential elections in modern times.
France presented its 2027 budget bill on Thursday, seeking to enact unpopular belt-tightening measures. And local governments are bracing for painful cuts. The national government provides most of the financing for local and municipal budgets – and it's now seeking 5.4 billion euros in savings there. Across the country, mayors are scrambling to figure out how to cut back, while still providing essential services.
French Prime Minister Sébastien Lecornu is due on Thursday to present a belt-tightening government budget for 2027, with savings predicted to come from freezing wages in the public sector and all but the lowest pensions. A series of targeted tax measures are expected as well.
A French battery maker backed by Renault SA is planning to ask creditors for more flexibility with the terms of its debt after its production ramp-up fell behind schedule, in the latest example of the challenges facing Europe’s electric vehicle manufacturing industry.
Anna Edwards, Guy Johnson, Tom Mackenzie and Mark Cudmore break down today's key themes for analysts and investors on "Bloomberg: The Opening Trade." (Source: Bloomberg)
As the political stakes rise in France, the country’s equities are looking vulnerable. They are under-performing, under-owned and worst of all perhaps, Europe’s most unloved.
President Emmanuel Macron is in Spain for the final day of his two-day state visit, the first by a French president to the country since 2009. After being welcomed with a banquet at the Royal Palace by King Felipe VI on Tuesday, on today's agenda is the opening of the Franco-Spanish economic forum and a meeting with Spain's leftist Prime Minister Pedro Sanchez. Once economically ahead of Spain, France is now seeing Spain grow faster, as the Spanish economy has outpaced its French neighbour in recent years.
Inflation in France quickened to the fastest pace in more than two years as surging oil and natural gas costs continue to weigh on Europe’s economy. Inflation in the euro area’s second-biggest economy stood at 3.4% in September, up from 2.6% in August, statistics agency Insee said. The reading keeps pressure on the European Central Bank to continue raising interest rates. Bloomberg's Oliver Crook has the details. (Source: Bloomberg)
A measure of French bond risk reached another milestone as investors gird for potential political upheaval next year.
The French government will sell a record amount of bonds to investors next year as it faces a surge in Covid-era debt due for redemption and needing to be refinanced, the public debt management office said on Tuesday amid mounting concern about France's surging public deficit and borrowing rates.
Stellantis NV said it will temporarily suspend operations at some plants in France next month amid a shortage of long-range electric-vehicle batteries and efforts to contain dealer inventories.
More than €2 billion ($2.3 billion) was wiped off the value of French airport and highway operators on Tuesday after the government said it’s considering higher taxes on transport infrastructure.
Monday is the final day of Pope Leo'svisit to France and the trip has been marked not only by an outpouring of emotion from France's Catholics but also flurry of economic activity. The first figures are beginning to come in from the pope's trip, and unsurprisingly, they're showing a big boost in tourism activity related to his appearances - with hotels and restaurants in and around the cities he's visited getting a particular benefit.
For Ariel Bezalel, thinking about investing in French bonds brings to mind Greece more than 15 years ago.
Chanel plans to keep investing in China, undeterred by the downturn in the country that has hit the luxury industry hard.
The town of Lourdes in southern France will be the second stop on Pope Leo XIV’s visit to the country, following his time in Paris. Around 150,000 people are expected to attend a mass led by the pontiff at the Sanctuary of Our Lady of Lourdes on Sunday. Local businesses are hoping the influx of visitors will also boost the economy, as pilgrims spend money on souvenirs, food and other goods. Our report by C. Neidhardt, C. Romain, E. Auriaux and C. Bénétreau.
Under pressure to help businesses and workers cope with soaring fuel prices, the French government has announced it will expand targeted energy relief for those most affected. The new measures will cost €450 million, bringing the total so far to €1.4 billion. Meanwhile, as French president Emmanuel Macron calls for allowing more biofuels to be added to diesel, we speak with an expert on the potential environmental impact of a rapid ramp-up in biofuel use.
Emmanuel Macron has written to the EU Commission president, Ursula von der Leyen, calling on Brussels to take immediate action to lower energy prices. They have been on the rise as the conflict in the Middle East spreads, and as Ukraine's attacks on Russian diesel refineries continue.
French President Emmanuel Macron and Canadian Prime Minister Mark Carney have announced plans to deepen economic ties between their countries following a meeting at the weekend. Macron welcomed Carney in Saint-Pierre-et-Miquelon, a French territory off the coast of Canada’s Newfoundland. The two leaders discussed opportunities to share infrastructure in the space and defence sectors, as Canada’s trade relationship with the US deteriorates and Europe looks to diversify its energy supplies. Bryan Quinn has more.