French borrowing costs rise amid deficit concerns

On Monday, the gap between French and German borrowing costs expanded as investors considered France's deficit situation heading into the upcoming presidential election and rising energy prices. Germany's 10-year yield, which serves as the benchmark for the euro zone, dipped by nearly 1 basis point to 3.48%. In contrast, France's equivalent yield increased by almost 4 basis points to 4.90%, resulting in a widening disparity of 142 basis points.

This metric indicates the additional return investors seek when lending to France instead of Germany. The spread reached its highest level since November 2011 at 158.67 basis points. Recent polls revealed that far-right leader Marine Le Pen and hard-left rival Jean-Luc Melenchon had widened their leads over other candidates, signifying heightened political polarization.

Oil prices surged to near two-week highs on Monday as attacks on Saudi Arabia overshadowed potential additional supplies to the market following US President Donald Trump's announcement of fresh Russian diesel exports and a proposed energy ceasefire between Russia and Ukraine.