France’s ten-year government bond yield reached 5% last week, its highest level in more than two decades. The extra interest it pays over Germany – the “spread” investors use to gauge French-specific risk – has widened dramatically. Parliament is wrestling with a 2027 budget requiring €54 billion in fiscal measures, while protests and violent clashes across France dominate the headlines.
With political instability and social tensions rising, comparisons with Greece at the start of its debt crisis have become inevitable. As Greece’s finance minister when its crisis erupted in 2009, I am increasingly asked how the two situations compare. I understand the temptation, but also how misleading it can be.
