Euro Zone Ministers Urge France to Pass 2027 Budget as Bond Yields Hit 25-Year High

Euro zone finance ministers and the European Central Bank on Thursday called on France to pass a 2027 budget to calm bond markets, as French borrowing costs hover at 25-year highs. France's 10-year bond yield has risen nearly 80 basis points since the start of September, reaching its highest level since July 2002 at just under 5%. The surge stems from concerns over the country's large budget deficit and the looming 2027 presidential election. EU Economic Commissioner Dombrovskis said a sound budget for next year is essential to reassure markets. France said in September its deficit will overshoot the government's 5% target this year, and it plans to sell a record €340 billion ($381 billion) of bonds in 2027. Officials said no euro zone institution is ready to intervene to lower French borrowing costs, noting France's excessive deficit procedure makes it ineligible for ECB support.