"The common European currency euro fell against main rivals and French borrowing costs spiked as Sebastien Lecornu, who had been France's prime minister for less than a month, resigned on Monday (October 6) just 14 hours after naming a largely unchanged cabinet. However, shortly after quitting, Lecornu accepted a request from French President Emmanuel Macron to work on a plan for the "stability for the country" by Wednesday evening."
"How to deal with France's huge sovereign debt continues to be an issue on which politicians cannot reach agreement. As a result, the yield on France's benchmark OATS government bonds rose far more than other eurozone bond yields. Further indication that investor confidence in Europe's second-largest economy is shaken is the fact that OATS now trade at a slightly higher spread than the BTP government bonds of highly indebted Italy for the first time since the launch of the euro in 1999."
Sebastien Lecornu resigned as France's prime minister just 14 hours after naming a largely unchanged cabinet, then agreed to help draft a stability plan by Wednesday evening. The surprise resignation and uncertainty over possible fresh legislative elections rattled markets, sending the euro lower and Paris stocks sharply down. Investors punished France's sovereign debt, lifting yields on benchmark OATS far more than other eurozone bonds and pushing OATS spreads slightly above Italy's BTPs for the first time since 1999. France's consolidated national debt stands near 3.35 trillion ($3.9 trillion), about 113% of GDP, and is projected to rise further.
Read at www.dw.com
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