KEY TAKEAWAYS On October 1, 2026, the yield on French 10-year government bonds (OATs) touched 4.919%, while German 10-year Bund yields stood at 3.508%. The spread between the two is 141 basis points. This represents the widest divergence since 2012, when the eurozone was genuinely fragmenting under the weight of sovereign debt fears, bank stress, […]
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The conditions for the European Central Bank to use its anti-fragmentation tool do not yet appear to be met. When this instrument was created in July 2022, the spread between Italian and German 10-year rates (BTP-Bund) was close to 250 basis points, a level higher than the current 150 basis points difference between France and Germany.