French IG corporate bonds trade below sovereign yields; inversion signals market stress

Nearly 40% of French investment-grade corporate bonds now yield less than French government bonds of similar maturity, a rare inversion indicating investors perceive sovereign risk as elevated relative to top corporates. This reflects persistent fiscal concerns and political instability in France, while blue-chip firms retain stronger credit profiles. The inversion could pressure French borrowing costs and signal broader euro-area sovereign risk repricing.