France’s 10-year bond yield reached 4.96% on Thursday, the highest since July 2002, as student unrest entered its fifth straight day and the government considered school spending it can ill afford. The timing is awkward. Paris must calm bond markets while answering street demands for more money.
The United Nations said Friday it was following the French high-school protests “with concern.” Shabia Mantoo, spokesperson for the UN human rights agency, said: “We are following with concern incidents related to the student protests and high school blockades in France, some of which have turned violent.”
The Fiscal Picture
The Education Ministry said 141 of the country’s 3,700 high schools had closed Friday. Education Minister Edouard Geffray announced late Thursday that around 3,000 substitute teachers would go to the 114 high schools hit hardest. Prime Minister Sebastien Lecornu pledged a plan to address the crisis by the end of October.
Economy Minister Roland Lescure said the government could meet demands for more school funding despite tight limits on the 2027 budget. Under the current draft, education would receive the second-largest funding increase after defence, with spending rising 1.4% to €90.9 billion. Student union representative Marius Mesnil wasn’t impressed. “We’re being offered a few crumbs,” he said, calling for another wave of demonstrations Tuesday.
The deficit is already high and is projected to rise next year. EU Economy Commissioner Valdis Dombrovskis, speaking after a Eurogroup meeting in Luxembourg, urged France to pass a budget. “Putting in place a sound budget for the next year will be important to ensure this predictability and credibility and to reassure markets,” he said, adding that he’s in contact with Lescure.
People familiar with the Luxembourg discussions said European Central Bank President Christine Lagarde faced questions about sovereign spreads. She declined to comment on France and said the ECB had the instruments needed to counter disorderly market dynamics. Bank of France chief Emmanuel Moulin said earlier in the week that ECB intervention wasn’t needed in the “current conditions.”
Order on the Streets
Nearly 7,000 people, 86% of them minors, have gone into police custody since mid-September, according to the Justice Ministry. Most of the students, aged 15 to 18, are protesting teacher shortages, overcrowded timetables, deteriorating facilities and buildings ill-equipped for rising temperatures.
Most demonstrations stayed peaceful. Some protesters set fires and vandalised bus shelters. Police deployed tear gas, batons and blast balls, drawing accusations of excessive force from human rights groups and student protesters. Authorities opened 18 internal investigations into alleged police misconduct.
Euronews correspondent Estelle Nilsson-Julien reported from Paris that the mood was tense, with protesters still angry at what they saw as a lack of decisive government action, even after officials changed course following an initial response criticised as heavy-handed. Place de la Bastille filled with demonstrators, and clashes were reported by evening. The intensity brought back memories of the Yellow Vests movement; leaders on both the far-left and far-right were trying to capitalise on public discontent, the report said.
Strasbourg Row
Separately, France Unbowed MEP Rima Hassan defended removing an Israeli flag from an October 7 commemoration at the European Parliament in Strasbourg. Photographs showed the flag on the floor beside the EU flag, prompting widespread backlash and allegations of antisemitism.
Hassan called the act a protest against the Israeli state. “I maintain my absolute opposition to the Israeli embassy being invited to the European Parliament, just as the Russian embassy is strictly prohibited from organising or co-organising events,” she said. She said CCTV footage, which she reviewed with Parliament President Roberta Metsola, showed her “rather softly, taking the Israeli flag down from its stand.” She denied intentionally knocking down the EU flag and said neither flag was “trampled on, thrown about or damaged.”
Asked if she regretted how she expressed her views, she said: “Sometimes, a political mandate can be accompanied by an activist gesture, a symbolic gesture.”
Why This Matters:
France is the eurozone’s second-largest economy, and its borrowing costs have reached levels unseen in more than 24 years. A government tasked with funding school repairs and teachers while reassuring bond investors has little room for error. Brussels and Frankfurt are watching closely, but their instruments can’t replace a credible national budget. Democratic accountability rests in Paris, not Luxembourg. The Strasbourg episode also raises questions about conduct inside the European Parliament, where elected members carry the institution’s reputation with them. From a fiscal-sustainability perspective, the next test is whether the 2027 budget passes and whether officials can find education money without widening the deficit further.