Air Liquide successfully issued €2 billion in multi-tranche euro bonds Monday as the spread between French and German 10-year yields widened to 146.30 basis points—near a 15-year high—signaling renewed skepticism over France's fiscal trajectory and political stability.
The OAT-Bund spread had reached its peak Friday during concerns that France's debt-to-GDP ratio will climb from 119 percent this year to 122 percent next year. Even as the government unveiled a fiscal package aimed at capping the deficit below 6.5 percent of GDP, the measure does not arrest the debt expansion, leaving the market unconvinced.
The widening reflects duration risk for investors holding longer-dated French pa. The European Central Bank has maintained a high threshold for intervention, effectively leaving sovereign bonds under sustained seller pressure as political headwinds persist.
Equity markets diverged on the fiscal stress. France's CAC 40 fell 0.7 percent, while Germany's DAX gained 0.2 percent and the UK's FTSE 100 rose 0.6 percent. The euro slid to a 17-month low against the dollar, underscoring broader Eurozone concerns.
Air Liquide's shares rose following the company's unveiling of a new strategic plan through 2030, a development separate from the fixed-income market turbulence.
