ISTANBUL
The war in Iran is threatening mortgage lending in France by pushing up interest rates, Le Figaro reported Monday.
The blockage of the Strait of Hormuz is extending far beyond higher fuel prices, also driving up mortgage rates and putting pressure on French people with property plans.
Rising government bond yields, particularly the French 10-year OAT, could have an immediate impact on borrowers, as these rates serve as a benchmark for residential mortgage lending.
On Friday, the 10-year OAT surged to nearly 3.90%, a level not seen since the 2009 financial crisis. The spike prompted several banks to raise their rate schedules for April by an average of 0.10 percentage points and by as much as 0.30 points for one institution.
“Other banks will follow with similarly strong increases,” said Pierre Chapon, co-founder of broker Pretto.
Lending rates were already rising due to budget difficulties and public debt concerns before easing earlier this year, but the latest surge comes at an inopportune time for banks, according to Le Figaro.
For now, the impact of higher rates remains manageable for borrowers and does not fundamentally alter the affordability of a property purchase.
“The increases in borrowing costs remain limited for now,” noted Eric Allouche, head of the Era Immobilier network in France.
– Protests against rising fuel prices
Meanwhile, French drivers are reacting to soaring fuel prices and criticizing the government’s response.
On Monday, dozens of coaches and trucks staged a slow-driving protest in Paris against the €50 million ($57 million) aid announced for April by Transport Minister Philippe Tabarot, according to broadcaster France Info.
Drivers say the aid is insufficient to offset the surge in pump prices.
“The state needs to help us more, particularly regarding taxes, and that’s where we hope to be heard,” Julien Bigaud, manager of a transport company, told the broadcaster.
Regional escalations have continued to rage since Israel and the US launched a joint offensive on Iran on Feb. 28, killing more than 1,340 people, including then-Supreme Leader Ayatollah Ali Khamenei.
Iran has retaliated with drone and missile strikes targeting Israel, Jordan, Iraq, and Gulf countries hosting US military assets, causing casualties and damage to infrastructure while disrupting global markets and aviation.
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