European bond markets are splitting by maturity and by country, according to recently published research — and the stories don't actually contradict each other.
At the front end, one camp of analysts argues that roughly 30bp of ECB tightening still priced in looks vulnerable. With oil-driven inflation pressures fading and growth weakening, they expect markets to walk those hike expectations back, pulling short-dated euro government yields lower.
At the long end, a separate strand of research sees French 10-year yields staying elevated or grinding higher over the next year. The case rests on France's heavy debt load and a fiscal trajectory researchers describe as unsustainable, which they argue locks in a lasting risk premium.
Further out the curve, the published consensus points to Dutch pension reform as a structural force. Forced reallocations are expected to steepen the euro 10s30s swap curve by another 10–20bp while boosting demand for long-dated Dutch government bonds — pushing their yields down and narrowing the Bund-DSL spread.
So the apparent long-end disagreement is really two different sovereigns, two different drivers: fiscal stress in France, pension flows in the Netherlands.