Fast forward to today and that fear is nowhere to be found.
The French-German 10 year bonds to bunds spread is tanking today, down by over 8%.
This positivity could owe to the approval of new austerity measures in Italy as part of the 2012 budget and S&P’s denial of a rumour that France had been downgraded. Even so, France still faces significant hurdles ahead.
The falling spread this morning has erased much of its more than 12% gain yesterday:
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