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Instagraph

September 27, 2024

French drama

Investors remain sceptical about the political landscape in France under the Barnier government, particularly regarding the sustainability of its public finances. Although France’s net debt-to-GDP ratio (110.8%) is indeed lower than Greece’s (159.8%), it faced a far larger public deficit in 2023 (-5.5% compared to Greece’s -1.6%). In a remarkable development, the yield on Greece’s 5-year government bond dropped below that of France’s for the first time in history. This shift suggests that financial markets now view Greece as a more favourable borrower than France. Image preview