French and peripheral euro zone debt spreads, CDS up

The cost of protecting government debt against default in France as well as several peripheral euro zone sovereigns rose on Monday over heightened worries about risks to Hungary's burgeoning debt.

The premium investors demand to hold French 10-year bonds rather than safer haven German Bunds <FR10YT=TWEB><DE10YT=TWEB> also rose to its highest since late April 2009 at 46 basis points.

The Italian 10-year BTP yielded 174 bps over Bunds <IT10YT=TWEB>, a record high.

Five-year credit default swaps (CDS) on French government debt rose to 100 basis points from 92 bps on Friday, according to CDS monitor Markit.

It means the cost rises to 100,000 euros to protect 10 million euros-worth of French government bonds.

Austria's CDS rose to 128 bps from 106 bps on Friday. Austria has considerable exposure to the Hungarian economy.

Markit said that Hungary's CDS rose to 438 bps from 421 bps on Friday.