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Eurozone Sentix confidence falls in October on weaker expectations

Sentix said the weakness has shifted from Germany to France as French 10-year yields rose about 70 basis points in a month.

Reported · Written up by our desk · Major Pairs

Eurozone investor confidence deteriorated in October, with the Sentix Overall Index falling from 5.1 to 2.7, Action Forex reported.

The drop was driven entirely by a fall in expectations, while the Current Situation Index held steady at -3.3. The Expectations Index declined from 13.8 to 8.8.

Sentix said the center of weakness is shifting geographically. Instead of Germany, where the current-situation assessment improved for a fourth consecutive month, France is becoming a larger concern as French government bond yields rise.

The survey noted that French 10-year yields increased by around 70 basis points within a month and highlighted that the widening OAT-Bund spread evokes memories of the 2011 sovereign-debt crisis, even as inflation sentiment improved from -31.5 to -19.5.

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