Euro Pain Fuels Dollar Gains Amid French Debt Woes

The US dollar saw significant gains yesterday as investors sought shelter from growing concerns about European debt, particularly in France.

US Treasury yields eased slightly, partly due to a sharp selloff that made them more attractive, and partly because of fears over European governments' ability to manage their debt.

The French-German 10-year yield spread spiked to above 140 basis points (bp), the highest since 2012, during the euro area sovereign debt crisis.

This dramatic increase in the yield spread has investors questioning whether US debt is safer than that of other developed markets.