France's brewing political crisis is spilling into financial markets with French borrowing costs hitting the same level as debt-ridden Greece's for the first time.

France’s benchmark bond yield matched Greece’s for the first time on record, the latest milestone in a week marked by mounting anxiety over the fate of Prime Minister Michel Barnier’s government.

Borrowing costs for France have hit a 12-year high relative to Germany, and were more than those of Greece for the first time ever

The 10-year yield on French government debt briefly reached 3.02 per cent in early trading on Thursday, crossing above the 3.01 per cent yield demanded by lenders to Greece, before switching back. The crossover reflects an upheaval in the perceived riskiness of Eurozone borrowers and underscores investors’ concern about France’s political and fiscal outlook at a time when Barnier’s minority administration is struggling to push through €60bn of tax increases and spending cuts.