European debt crisis

"Is France now Greece on the Seine?" wonders the Wall Street Journal, as investors fret that turmoil in Europe's second-largest economy could trigger a new eurozone crisis.

A motion of no confidence has been filed by the New People’s Left Front and Le Pen’s far-right party. If passed, it would topple the Barnier government and prevent the approval of the 2025 state budget.

In December, the government is set to submit a new request—its fifth so far—to the Recovery Fund for a disbursement of €3.3 billion. This request is part of a €36 billion program, equivalent to roughly 20% of Greece’s GDP, making it proportionally the largest in Europe.

The yield on Greek 10-year government bonds fell below that of the corresponding French bonds on Thursday.

More specifically, the yield on the Greek 10-year bond stood at 2.99% when the corresponding French 10-year bond reached 3.05%.

The European Commission has given a positive evaluation of Greece's 2025 budget plan and medium-term fiscal strategy, according to the autumn package of the European Semester released on Tuesday.

Greece must revise its budget for 2025 because there is more money available than anticipated. This is due to the increased tax revenues and the early repayment of previously taken loans ahead of schedule.

Cyprus made strides in paying down its debt in the second quarter of 2024, settling over 1 billion euros in bonds and loans. According to the Cypriot Finance Ministry's Debt Management Office (PDMO), this repayment approach helps reduce the national debt, boost financial stability and potentially open up new benefits for Cypriot citizens and the economy.

Greek bonds are a “safe haven” for investors against the turbulence triggered in international money markets by the negative signals sent by major European economies and the turbulent geostrategic environment of the two wars in Ukraine and the Middle East.

In 2023, Bulgaria maintained one of the lowest government debt-to-GDP ratios in the EU at 22.9%, as overall government deficits in the euro area and EU slightly increased. Government deficits rose to 3.6% of GDP in the euro area and 3.5% in the EU, while government debt levels fell across the region.

Greece's September reading of the European Union-harmonized consumer price index was eventually even higher than projected on October 1 and further from the eurozone average, according to figures Eurostat released on Thursday.