Investors were unable to shake off concerns about high indebtedness in neighboring France on Tuesday either. The euro continued to trade within reach of its 17-month low on Tuesday. The common currency EUR/USD recently traded at 1.1296 dollars. High oil prices continue to act as a drag on the currency.
EUR/USD chart on a monthly basis
Return on French government bonds (10 years) recently reached almost 5 percent
Recently, however, yields on French government bonds with a ten-year maturity have shown some signs of easing. At the beginning of the week, the sell-off in these bonds accelerated. Today, the neighboring country officially plans to present its 2027 budget.
Last week, yields barely reached the 5 percent mark, which was the highest level since August 2002. France’s public debt stood at 3.6 trillion euros in the second quarter of 2026, which is equivalent to 119 percent of GDP, after 115.6 percent in 2025, as the INSEE statistics agency reports.
French government bonds with a maturity of 10 years
Outlook: Fed minutes to be released on Wednesday – monetary policy is expected to remain a significant factor
Potential drivers of the market are scheduled to be on the agenda on Wednesday with the „FOMC Minutes“ (20:00). In this context, investors are hoping for important indications regarding the future direction of US monetary policy. On September 16, the Fed last adjusted the interest rate by a quarter of a percentage point, bringing it to a range of 3.75 to 4.00 percent. The monetary policymakers voted unanimously in favor of this move.
Only last Friday, the US labor market data (Non-Farm Payrolls) showed significantly weaker figures than expected (90,000) ahead of the release. Moreover, the unemployment rate also rose by 0.1 percentage points to 4.2 percent. In this context, concerns about general interest rate hikes may have lost momentum.
