With the rise of communist candidate Melenchon throwing the French election results into disarray for the status quo supporters, it appears traders are rushing headlong for the safety of core-core Europe and rapidly exiting anything to do with France.
As reported in our overnight wrap, the recent surge in far-left candidate Melenchon has changed the French presidential election calculus materially in recent days, sending the spread between French and German 10Y blowing out again, helped by yesterday's Goldman downgrade of French OATs.
Looking elsewhere on the curve, as the Trump election hit, France and Germany were equal in terms of 2Y bond yields; since then, the risk premium for owning French bonds over German has exploded to over 55bps - the highest since May 2012.
This is practically the highest level of differentiation between the core European nations' bond markets since the very peak of the European crisis.
It's not just France however, as 1-month, 25 delta EURUSD risk reversals hit levels not seen since the depths of the Eurozone crisis, suggesting the market views Le Pen's odds of winning as far higher than the daily polls would suggest.