Budget crisis: interest rates beyond 5%, a punishment from the markets that France has inflicted on itself

French 10-year bond yields have surpassed 5% for the first time since July 2002, signaling a dual budgetary and political crisis. This rise is largely self-inflicted, not stemming from international issues. Initially, global interest rates were rising, affecting France as a weaker link. Recently, while global rates remain high, the spread between French and German yields has widened significantly, reaching 157 basis points, a level not seen since 2011. The rapid increase in this spread has been notable, rising from around 50 basis points in May 2024 to nearly 160 points now.