Something uncommon is occurring in European bond markets. A fortnight in the past the yield on French ten-year authorities debt surpassed that of Spain, suggesting traders see the euro zone’s second-largest financial system as riskier than its southern neighbour’s (see chart 1). That’s fairly the turnaround. In January Spanish yields had been 0.4 share factors greater than their French equivalents; on the worst of the euro-zone disaster, the hole was nearer 5 full share factors. French borrowing prices at the moment are properly above the degrees of Portugal and nearer to these of Greece and Italy than they’re to Germany’s.
