FX.co ★ France’s 10-Year Bond Yield Nears 3.5% Amid Risk Appetite

The yield on France's 10-year government bonds approached 3.5%, marking its highest point since October 9, in line with trends seen across European markets. This increase occurred as investors shifted towards riskier investments like stocks, buoyed by positive earnings reports from AI powerhouse Nvidia. Market focus continues to be on the postponed US jobs report, which investors hope will provide further insight into the Federal Reserve's potential policy adjustments. Additionally, recent minutes from the Federal Reserve's meeting have dampened the likelihood of a rate cut in December. Meanwhile, in Europe, the European Central Bank is anticipated to maintain steady interest rates throughout the next year. In a recent update, the European Commission has adjusted its forecast for France's GDP growth, predicting an expansion of 0.7% in 2025, down from the 1.2% previously expected in spring. This is projected to climb to 0.9% in 2026 and 1.1% in 2027. Domestic demand remains weak against a backdrop of economic uncertainty and fiscal reforms. These forecasts diverge from the optimistic comments made by Bank of France Governor François Villeroy de Galhau, who hinted at possible upward adjustments to growth predictions for 2025–2026.