U.S. Treasury Secretary Scott Bessent said Oct. 20 he did not expect turmoil in France’s bond market to spread, as its 10-year yield neared 5% and fiscal pressure mounted.
Reuters put the French 10-year yield at 4.88% in its Oct. 20 market update, after a session peak of 4.9877%. The yield was about 150 basis points, or 1.5 percentage points, above that of comparable German bonds, Reuters reported.
“I don’t anticipate a spillover from what’s happening in France,” Bessent said on 2WAY’s The Morning Meeting. He praised President Emmanuel Macron’s economic team. Bessent also described “flight-to-quality” flows into U.S. Treasuries from unnamed countries he considered more concerning.
Insee, France’s statistics agency, reported Maastricht general government debt of €3,595.5 billion at the end of the second quarter of 2026. That was 119.0% of gross domestic product (GDP), up from 117.5% in the first quarter.
The French government forecasts a deficit of 5.4% of GDP in 2026 and aims to reduce it to 5.0% in 2027. Its draft budget proposes €43 billion in corrective measures, largely through spending controls. The government expects interest costs to climb from €79.2 billion in 2026 to €91.2 billion in 2027.
The AP separately reported that demonstrations spread beyond student blockades on Oct. 17. Protesters raised concerns about living costs, school conditions, public services and housing.
Insee is scheduled to release France’s third-quarter debt figures Dec. 18.
