Fiscal Risks Weigh, but Bonds Still Find Demand

Edmond de Rothschild’s Market Flash (5 September 2025) reviews political and economic developments shaping bond markets and investor sentiment.

• France: Despite looming government collapse, the Treasury raised €11bn in long-dated debt, underscoring persistent demand for OATs.

• UK: Fiscal credibility concerns pushed 30-year gilt yields to highs not seen since 1998.

• US: Treasury yields briefly touched 5% before weak economic data pulled them lower, fueling expectations of Fed easing.

How should investors position across equities, bonds, and currencies amid mounting political and fiscal pressures?