FX.co ★ France 10-Year Bond Yield Edges Down

France's 10-year bond yield has declined towards 3.42%, aligning with trends observed in European and US markets. This movement follows Federal Reserve Chair Powell's comments at Jackson Hole, hinting at potential interest rate reductions in the near future. Nevertheless, he emphasized that the central bank will proceed with caution, carefully assessing the effects of tariffs and other policies on the economic landscape. The European Central Bank (ECB) wrapped up its rate-cutting sequence in July following eight consecutive reductions; however, market expectations still reflect a 45% probability of an additional cut this year, with a pause anticipated in September. Meanwhile, recent statistics from Germany and the broader Eurozone indicate that private sector activity has been accelerating at a quicker rate in early August compared to July. On the domestic front, France's services and composite Purchasing Managers' Index (PMI) have reached their highest levels in 12 months, and the manufacturing PMI has hit a three-month peak, all suggesting that the French economy is beginning to stabilize.