European bond prices look set for further pressure, with published research broadly pointing to higher Eurozone long-end yields and wider French spreads versus Bunds.
The core driver, researchers argue, is the ECB's ongoing tightening cycle. One camp of analysts sees policy rates pushing toward 3% as inflation proves sticky, with Eurozone 2-year swap rates holding near 3.55–3.60% and the 10-year reaching 3.85% by end-2027. The strategic case rests on above-target inflation, rising public debt-to-GDP, and elevated energy costs. ECB Chief Economist Philip Lane has also flagged a marked rise in long-term yields linked to the US investment surge and AI-driven capital demand, with no near-term reversal in sight.
French OATs draw particular concern. Several published views see the OAT–Bund spread re-widening into budget approval and the 2027 presidential race, citing fiscal fragility. A contrarian thread notes French 10-year yields have eased on Marine Le Pen's deficit-reduction pledges — but researchers frame this as credibility-dependent, not a structural turn.