French 10-Year Bond Yields Fall Sharply Amid Rising US-EU Trade Tensions

France’s 10-year OAT bond yield has fallen sharply to 3.2%, reaching its lowest point since May 8. This decline is mainly due to increasing concerns about escalating trade tensions between the United States and the European Union, coupled with uncertainties surrounding the US fiscal outlook.

Investors are gravitating towards safe-haven assets as market risk perceptions rise. The decrease in bond yields followed statements by US President Donald Trump, who remarked that trade negotiations with the EU were “going nowhere.” This comment heightened worries about the potential for prolonged trade disputes and their impact on global economic stability.

Key factors contributing to the bond yield drop include:

• Escalating US-EU trade tensions
• Uncertainties over the US fiscal policy outlook
• Investor preference for safer investments amid market risks
• Negative sentiment following President Trump’s remarks on stalled trade talks

This trend highlights the ongoing challenges in US-EU trade relations and reflects the cautious sentiment prevailing among investors in the current economic environment.

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