The yield on France’s 10-year OAT climbed to 3.38% on Monday, rebounding from an over two-month low of 3.308% last week, following S&P Global Ratings’ unexpected downgrade of the country’s credit rating. On Friday, the agency cut France’s rating to A+ from AA-, citing increased risks to fiscal consolidation and persistent uncertainty over government finances, despite the submission of the 2026 draft budget to parliament. Elsewhere, risk appetite improved amid signs of easing US-China trade tensions and stabilizing confidence in US regional banks, though investors remained cautious ahead of Friday’s delayed US inflation data, which could offer further guidance on the Federal Reserve’s rate-cut outlook.
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