France’s 10-year bond risk premium rose to 120 basis points, the highest since 2012, as investors brace for political instability ahead of the presidential election. The spread over German bonds widened amid uncertainty over fiscal policy and a fragmented parliament. President Emmanuel Macron’s administration faces opposition from far-right candidate Marine Le Pen and far-left rival Jean-Luc Mélenchon, both projected to reach the runoff.

France’s debt agency plans to sell €340 billion in medium- and long-term debt next year, the highest on record. The 2027 budget is due Thursday, with the deficit expected to swell to 5.4% of GDP in 2026. Long-term borrowing costs have risen to levels not seen since 2002, reflecting persistent fiscal and political volatility.