France’s 10-year OAT yield rose to 3.25%, rebounding from Friday’s eight-month low of 3.217%, as escalating tensions in the Middle East unsettled global markets and prompted investors to scale back expectations for interest rate cuts by major central banks amid renewed inflation concerns. Over the weekend, the US and Israel launched strikes on Iran, resulting in the reported death of Iran’s Supreme Leader and the effective closure of the Strait of Hormuz. Iran retaliated with missile and drone attacks across the region, further heightening geopolitical uncertainty. A sharp surge in oil and gas prices has intensified fears of renewed inflationary pressures across Europe, where gas inventories remain unusually low and significant replenishment will be required ahead of next winter. Investors are also monitoring key data releases this week, including flash Eurozone CPI figures for February.
