FRENCH BORROWING COSTS REACH 24-YEAR HIGH

France’s borrowing costs reached a 24-year high as investors sold government bonds amid budget uncertainty and street protests. The yield on France’s benchmark 10-year bond rose by more than eight basis points to 5% in morning trading, then eased to 4.99%. The French government has yet to pass its budget for next year. Carrefour shares also fell, though the available account gave no figure for the decline.

Students began protesting in September, calling for more funding to address mould, rats, teacher shortages and large classes in schools. The demonstrations later broadened to include concerns about the cost of living. Aggressive police tactics at some protests preceded riots in towns and cities. Looters targeted stores including Louis Vuitton, and protesters set fire to the town hall in Limoges.

No party has held an overall parliamentary majority since President Emmanuel Macron called a snap election in 2024. Parliamentary deadlock has blocked his proposed increase in the pension age from 62 to 64, alongside measures to reduce or redirect state spending. Budget figures put France’s 2025 deficit at 5.1% of gross domestic product and its debt at 115.6% of GDP. Forecasts cited for the current financial year show both measures rising without further action. International lenders have accused the government of becoming “fiscally incontinent”.