France’s ten-year borrowing rates on Thursday exceeded the 4% mark for the first time since June 2009, whilst Belgium’s ten-year rate reached its highest level since 2012, at 3.753%.
In Germany, the yield on the ‘Bund’ (the 10-year bond) stood at 3.20%, its highest level since 2011. It had fallen back to 3.19% by 10.15 am.
These 10-year rates reflect the yields that French and foreign investors will demand from this Thursday onwards to lend to France, Belgium and Germany for a decade.
The higher this rate, the greater the burden of debt servicing on public finances.
The symbolic 4% threshold raises questions about the interest costs on France’s public debt, which stands at a record high of 117% of the country’s gross domestic product (GDP), amounting to more than €3,500 billion.
