France’s first bond auction since President Emmanuel Macron spooked markets by calling a snap election has attracted solid investor demand, easing concerns about rising yields on the country’s debt.
France sold just under €10.5bn in three, five, six and eight-year bonds on Thursday. The bid-to-cover ratio across the sales, an indication of the number of investors who put in offers to buy the debt, suggested the auction process “went fine, without any fireworks,” said Lyn Graham Taylor, a rates strategist at Rabobank.
Even so, the yield on the five-year debt, at 3.03 per cent, marked the highest yield on French debt of a similar maturity since last October.
The spread between benchmark 10-year French and German yields — a market barometer for the risk of holding France’s debt — stood at 0.74 percentage points on Thursday, down slightly from last week’s seven-year high.
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