French 10-year borrowing costs top 5% for the first time since 2002

The yield on France's 10-year government bond rose above 5% on 21 October, a level last seen in 2002, and reached 5.05% on 22 October. The gap over German Bunds widened to about 160 basis points, the widest since the euro-zone debt crisis.Sources:1Trading Economics: France 10-Year OAT yield news stream, Trading Economics, 22 October 2026 (source, opens in a new tab)2Voice of Emirates: French bond yields exceed 5% for the first time in decades amid widespread protests, Voice of Emirates, 21 October 2026 (source, opens in a new tab)

Prime Minister Sébastien Lecornu's minority government is struggling to pass its 2027 budget through a divided parliament; the plan aims to cut the deficit to 5% of GDP from 5.4%. Public debt stands at about 119% of GDP. Cost-of-living protests turned into riots in some cities.Sources:1Trading Economics: France 10-Year OAT yield news stream, Trading Economics, 22 October 2026 (source, opens in a new tab)2Voice of Emirates: French bond yields exceed 5% for the first time in decades amid widespread protests, Voice of Emirates, 21 October 2026 (source, opens in a new tab)3Fortune: 'France, truly, is on the brink' and just days away from a make-or-break moment in its debt crisis, Fortune, 17 October 2026 (source, opens in a new tab)

On 22 October, rising French yields helped push the CAC 40 down about 1%. Investors are awaiting a Moody's credit-rating review on 23 October; no decision had been announced.Sources:1Trading Economics: France 10-Year OAT yield news stream, Trading Economics, 22 October 2026 (source, opens in a new tab)4Associated Press (via BNN Bloomberg): AI stocks drag markets down worldwide as oil prices climb to their highest since May, Associated Press (via BNN Bloomberg), 22 October 2026 (source, opens in a new tab)

Mujtaba Rahman, managing director for Europe at Eurasia Group, said "France, truly, is on the brink," warning that if the budget fails, "the cost of servicing French debt may explode."Sources:3Fortune: 'France, truly, is on the brink' and just days away from a make-or-break moment in its debt crisis, Fortune, 17 October 2026 (source, opens in a new tab)