France Risks Biggest Bond Crisis Since Greece

• France is facing its worst bond-market situation since the eurozone debt crisis. Worries about French debt have pushed the euro to a 17-month low against the U.S. dollar. Yesterday, the yield on France’s 10-year bonds reached about 4.9 percent, the highest since 2002.

A higher yield means investors are demanding more interest to lend to France.

• At the end of June, public debt was €3.6 trillion (us$4 trillion), 119 percent of gdp. The deficit is around 5 percent of gdp, and investors are not convinced that the French government will improve the situation before the 2027 presidential election.
• Money is moving into German, Dutch and other safer European bonds.

That widens the gap between French and German borrowing costs and makes it more expensive for the French government to finance itself. Interest payments are €79 billion in 2026 and are projected to reach €91 billion in 2027. As old debt is replaced at today’s higher rates, more of the budget goes to interest.

The rest of the eurozone is exposed too.

• France is the bloc’s second-largest economy.
• The selloff is already lifting yields in Italy, Spain and other higher-debt countries.

The Greek bailout is not a reusable model. From 2010 to 2018, eurozone governments and the International Monetary Fund lent Greece €257 billion. France’s debt is €3.6 trillion, about 14 times that amount, and France plans to borrow hundreds of billions more next year.

France’s troubles benefit Germany, which has regained its place as Europe’s main bond-market safe haven. They also threaten the eurozone. If France lost market access, the bloc could not rescue it the way it rescued Greece, and that financial shock could break the currency union apart.

The euro is the dollar’s main rival, but it has never matched it. One reason is that it is not backed by a single national government, so investors cannot be sure how the union would share debts, or how long it would hold together, in a real crisis. The French selloff puts that weakness back in view.

The late Herbert W. Armstrong predicted that a financial crisis starting in the United States would eventually push European nations into a full fiscal union. Revelation 17:12-13 say that 10 kings will give their power and strength to the beast. That points to a more centralized economic order coming to the eurozone.