LONDON, June 12 French borrowing costs fell on
Monday, tightening the gap over benchmark Germany, after
projections from the first round of parliamentary elections
suggested the president's party is set to secure a huge majority
to push through pro-business reforms.
France's 10-year government bond yield fell 3 basis points
to 0.62 percent, outperforming other higher-rated
euro zone peers. The gap over benchmark German Bund yields
tightened to around 36 basis points from around 39
bps late on Friday.
Analysts said further signs of fading political uncertainty
in France also boosted sentiment towards lower-rated peripheral
bond markets, with Italian yields falling to their lowest levels
sine January and Portuguse yields tumbling to
nine-month lows of around 2.97percent.
(Reporting by Dhara Ranasinghe; Editing by Andrew Heavens)