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2026-11-04 17:20:33
[French Bond Yields Fall] The yield on the 10-year French OAT fell to around 4.9%, following a decline in US Treasury yields. This followed a major victory for the Democrats in the US midterm elections. Democratic control of the House of Representatives is seen as reducing the likelihood of the Trump administration enacting further deficit-expanding legislation, easing market concerns about US government borrowing. However, continued market concerns about France's own fiscal prospects continue to weigh on domestic bonds. Meanwhile, increasingly hawkish comments from European Central Bank policymakers have reinforced market expectations of a tightening monetary policy outlook. Despite deciding to keep interest rates unchanged last week, ECB officials hinted that further rate hikes may be necessary to curb inflationary pressures and prevent them from transmitting to wages.
