[MARKET ANALYSIS] OATs underperform after a weekend of unrest and ahead of Moody's on Friday

French spread widening on domestic political unrest into a ratings review follows a familiar script in the euro periphery and semi-core: the OAT-Bund spread has historically been the cleanest barometer of French political risk, and episodes where street unrest coincides with fiscal slippage and gains for the populist opposition have tended to push it wider in steps rather than in a single move, with each ratings or budget event acting as a checkpoint. The relevant channel here is not outright yield levels but the spread itself, since Bunds and USTs are finding their own support from the energy pullback, leaving the underperformance concentrated in French paper and, by sympathy, BTPs and Gilts where similar fiscal dissatisfaction themes apply. The distinction worth drawing is between contagion and coincidence: Italy and the UK widening on their own domestic themes rather than on French beta has in past episodes capped how far the peripheral move runs. Into a sovereign review, the established pattern is for the spread to stay bid wider ahead of the decision and then retrace partially if the agency stops at an outlook change rather than a downgrade, while a cut tends to force a second leg as index and mandate constraints bind. The follow-ons are the Moody's outcome, any government response that shifts the fiscal arithmetic, and whether RN polling momentum converts into concrete pressure on the budget timeline.