The French Finance Ministry stated that it has not adjusted its bond issuance strategy and will continue to make use of flexibility in government bond auctions.
This comes after France was considering issuing more short-term debt following a recent sell-off in longer-dated bonds.
"France's debt issuance strategy is guided by investor demand," the Finance Ministry said. "This gives us flexibility in deciding which specific bonds to issue at each auction, allowing us to stay as close as possible to demand."
"We reduced issuance of longer-dated bonds, namely those with maturities beyond 30 years, which reflects this strategy," the ministry added. "In a higher-yield environment, messages from primary dealers over the past few months indicated that demand for these bonds has declined."
After reports on Lescure's remarks were published, the spread between French and German 10-year government bonds briefly narrowed but soon rebounded, widening by 12 basis points to 140 basis points at the close.
After the French Finance Ministry said its bond issuance strategy had not been adjusted, French government bond futures maintained their declines.
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