US Treasury and euro-area government bond yields rose in early European trading
on Thursday, with US borrowing costs hovering near multi-decade highs touched on
Wednesday and approaching 24-year peaks. French government bonds continued to
underperform other euro-area peers as investors question Paris’s ability to cut
the fiscal deficit to 5% of GDP by 2027. MainSky Asset Management’s chairman
said that, given the current mix of nominal growth and interest costs, France’s
large debt stock is rising by about 8% a year, and warned that if the trend
continues France’s debt-to-GDP ratio could reach roughly 130% by end-2027.
