Les spreads

France is back on the radar.

The 10-year OAT/Bund spread has moved to around 100 bps, a level not seen since the euro crisis in 2012.

The reasons are well known: deficits above 5%, debt approaching 120% of GDP, weak growth and political fragmentation.

Also interesting to watch: the euro. Historically, wider French spreads have often gone together with a weaker EUR. So far, not this time.

Markets are still treating this as a French problem rather than a euro problem. The question is whether it stays that way.