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France’s political crisis is fuelling concern among economists who caution that sustained institutional paralysis could undermine growth and complicate efforts to stabilise public finances.
The sudden resignation of Prime Minister Sébastien Lecornu, less than a month into the role, has left the government without a working majority at a time of rising fiscal pressure.
With no roadmap for resolving the deadlock and President Emmanuel Macron facing mounting calls for fresh elections, analysts warn that continued uncertainty could jeopardise compliance with EU fiscal rules as Brussels sharpens its oversight.
French bond market signals rising country risk
France’s bond market wasted no time reacting to Lecornu’s resignation.
At the time of writing, yields on 10-year French government bonds (OATs) are now trading around 86 basis points above their German equivalents — a spread last seen during the collapse of the Barnier government in late 2024.
That puts c
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