French-German 10-year yield spread widens 2 bps to 78 bps

French-German 10-year yield spread widens 2 bps to 78 bps

The French-German 10-year yield spread has widened by 2 basis points to 78 basis points, marking a significant shift in the yield differential between the two economies. This development comes amidst ongoing geopolitical tensions and varying monetary policies.

The spread, which measures the difference in yields between French and German government bonds, is a key indicator of market sentiment and risk perception. A widening spread suggests that investors are increasingly concerned about the economic outlook in France compared to Germany.

According to data from the European Central Bank, the French 10-year bond yield stood at 1.5% while the German 10-year bond yield remained at 0.84% as of July 2, 2025. The widening spread indicates that investors are seeking safer havens, such as German bonds, as they perceive greater risk in the French economy.

This development comes in the context of broader geopolitical uncertainties, including the ongoing political instability in France and the potential impact of the Trump administration's stake in Intel. The deal, which involves the U.S. government taking a 10% stake in Intel, has raised concerns about potential adverse reactions from international customers and foreign governments, given the company's significant international sales [1].

Moreover, the spread widening coincides with the recent announcement of the French-German 10-year spread widening by 6 basis points to 76 basis points. This suggests that investors are increasingly cautious about the economic outlook in France compared to Germany.

References:
[1] https://www.cnbc.com/2025/08/25/intel-trump-deal-risks-stock.html