“A few days ago, France was paying close to 0.6% to borrow money for 2 years.
Today: 0.17%.
As borrowing costs have re-surged in Spain and Italy, France is seeing major safe-haven flows, the likes of which you normally associate with Germany.
German 2-year yields are already slightly negative, and at this rate, French borrowing costs will be negative soon.
On the surface, this is a bit of a head-scratcher, given the widespread view that new President Francois Hollande is a spend-happy socialist who is doubling down on bad historical fiscal practices.”
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