---
title: "French bonds slump as hard-left secures majority in parliament"
publisher: "Share Talk"
author: "sharetalk"
published: "2024-07-08T07:46:01+00:00"
modified: "2024-07-08T07:46:01+00:00"
date: 2024-07-08
canonical: "https://www.share-talk.com/french-bonds-slump-as-hard-left-secures-majority-in-parliament/"
category: "B2B"
categories: ["B2B", "Blogs", "Business & Support Services", "Technology", "Technology, Media & Telecoms"]
tags: ["bond yields", "Emmanuel Macron", "European", "FRANCE", "French", "German", "hung parliament", "Jean-Luc Melenchon", "Marine Le Pen", "National Rally", "NFP", "Paris", "parliament"]
image: "https://i0.wp.com/www.share-talk.com/wp-content/uploads/2024/07/Paris.webp?fit=1200%2C800&quality=80&ssl=1"
format: "news"
language: "en-GB"
---

# French bonds slump as hard-left secures majority in parliament

**Published:** July 8, 2024
**Author:** sharetalk
**Categories:** B2B, Blogs, Business & Support Services, Technology, Technology, Media & Telecoms
**Tags:** bond yields, Emmanuel Macron, European, FRANCE, French, German, hung parliament, Jean-Luc Melenchon, Marine Le Pen, National Rally, NFP, Paris, parliament
**Featured image:** ![](https://i0.wp.com/www.share-talk.com/wp-content/uploads/2024/07/Paris.webp?fit=1200%2C800&quality=80&ssl=1)

---

French government bond yields have slumped following Sunday’s election, putting the eurozone’s second-largest economy on track for a hung parliament.

The yield on France’s benchmark 10-year bond, known as an OAT, briefly traded at its lowest premium to German debt in almost a month. However, the yield, which is the return a government promises to pay buyers of its debt, last rose three basis points to 3.24%, after gradually retreating from a high of 3.37% last week.

German 10-year debt yields remained flat at 2.54%, widening the gap with French yields to about 71.15 basis points, a three basis points increase on the day. Earlier, the spread briefly hit a session low of 63.7 basis points, the narrowest since June 13.

Commerzbank rates strategist Rainer Guntermann commented that a hung parliament in France raises the risk of political gridlock, suggesting that the early rally in French bond prices may not be sustained. He noted, “The OAT risk premium is likely to persist and cross-country spreads will remain in motion.”

Two weeks ago, French spreads widened to as much as 85 basis points, the highest since 2012, as investors worried about the potential impact of either a hard-right or hard-left bloc gaining a majority in the elections on government spending.

In other news, Italian 10-year yields rose 2.2 basis points to 3.96%, narrowing the gap with Bunds by one basis point to 140 basis points.

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