French Yields Surge Amid Political Uncertainty as Germany Sees Safe Haven Inflows

France's 10-year bond yield increased to its highest since March, driven by political uncertainty after opposition parties withdrew support for the Prime Minister. Safe haven inflows led to a drop in Germany's yield, highlighting bond market volatility. U.S. political actions further complicated global market dynamics.

France's 10-year bond yields surged to their highest levels since March following the withdrawal of support by opposition parties for Prime Minister Francois Bayrou, intensifying concerns over political instability. The uptick comes amid wider global market apprehensions driven by developments in the U.S.

Meanwhile, Germany benefitted from a flight to quality, seeing its 10-year yield fall by 2 basis points to 2.73%. In contrast, France's yield reached 3.53% before stabilizing at 3.50%, underscoring investor concerns over Prime Minister Bayrou's contentious budget cuts.

On the international front, U.S. President Donald Trump's move to dismiss Federal Reserve Governor Lisa Cook over alleged mortgage improprieties added another layer of uncertainty. As market participants watch for repercussions, expectations mount for increased volatility in the days ahead.

(With inputs from agencies.)