France Sovereign Debt & OAT-Bund Spread Reckoning Simulator

Macro Scenarios

Model Calibration Parameters

Primary Deficit (% GDP) 4.60%

1.0% (Surplus effort)6.5% (Severe expansion)

Nominal GDP Growth Rate 2.20%

0.5% (Stagnation)4.5% (Boom)

German 10Y Bund Yield 2.40%

1.00%4.50%

OAT-Bund Risk Spread 145 bps

30 bps (Pre-crisis)220 bps (Downgrade stress)

Annual Debt Rollover €285 B

€240B/yr€340B/yr

* Model anchored to €2,900B French Nominal GDP baseline & €3,260B initial gross public debt (112.5% debt/GDP, 8.5-yr weighted avg maturity).

2032 Debt-to-GDP

128.4%

+15.9 pp vs 2026 baseline

2032 Annual Interest Bill

€94.2 B

2.82% of French GDP

10Y OAT Refinance Yield

3.85%

Blended rate: 3.12%

Rating Agency Risk Zone

HIGH STRESS

Spread > 120 bps trigger

Public Debt-to-GDP Trajectory (2026–2032)

Election Reckoning Path

Annual Interest Cost vs Deficit (€B)

Rollover Yield Step-up Dynamic

Multi-Year Sovereign Fiscal Audit Matrix Units: EUR Billions unless specified

Year	Nominal GDP	Gross Debt	Debt / GDP	Primary Deficit	Interest Service	Total Deficit	Rollover Volume	Marginal OAT Rate	Blended Debt Rate

Reuters Breakingviews Context & Sovereign Rollover Mechanics: France faces a compounding debt-servicing hurdle. With an 8.5-year weighted average maturity and ~€285B of sovereign bonds (OATs) maturing annually, legacy bonds issued at near-zero interest rates are systematically replaced by paper yielding 3.5%–4.2%. Even with moderate primary deficit cuts, sovereign debt will compound unless real GDP growth sustainably exceeds real borrowing costs (the r - g differential). An election-driven political risk spread widening above 100 bps directly adds billions to the annual state budget, narrowing fiscal room for healthcare, defense, and green transition.