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French Risk Premium Hits Highest Since 2012 as Debt and Political Concerns Mount

France’s RiskRisk is the possibility that the actual outcome of a trade, investment, or financial decision differs from the expected outcome and causes a loss or other unwanted result. Risk...Read More PremiumIn the forward-pricing context used here, a premium is the amount by which a forward price is higher than the current spot or market price of the underlying asset. It describes...Read More has reached its highest level since 2012 as concerns over rising debt and political uncertainty weigh on investor sentiment. Higher borrowing costs are increasing pressure on French government finances and markets.

French markets came under renewed pressure on September 25 as the GapA gap is an area on a price chart where the next period begins at a price that is separated from the previous period's trading range, leaving little or no trading activity...Read More between France's 10-year government-Bond YieldBond Yield refers to a bond yield is an annual amount you receive in interest from a bond, as a percentage of the bond’s initial cost. The term belongs in Level 7 because it hel...Read More and Germany's equivalent climbed above 110 basis points, its widest since the euro-zone debt crisis in 2012. Reuters reported that investors are focusing on France's high debt, fiscal deficits and political gridlock ahead of next year's presidential election. The move marks a fresh sovereign-risk signal for euro-area markets and a potential source of VolatilityDefinition   Volatility describes the size and speed of price changes over time. A high-volatility market makes larger or faster moves, while a low-volatility market...Read More for French bonds, banks and the euro.

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