French borrowing costs jumped to their highest since March and stocks sold off for a second day on Tuesday, as investors reacted to the prospect of a government collapse as soon as next month.
Prime Minister François Bayrou on Monday called a confidence vote for September 8 over his deficit-cutting budget proposals.
Lawmakers have two weeks to “say whether they are on the side of chaos or on the side of responsibility”, Bayrou said as he addressed union members on Tuesday. “The first risk, the one from which we would not recover, is denial.”
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