The future for French Prime Minister Michel Barnier's government looks bleak, with his struggles to push the 2025 budget through a polarised parliament increasingly likely to end in the toppling of his fragile coalition.

A commission of Senators and members of the National Assembly have hashed out a compromise 2025 budget that, if passed by the both full assemblies, could avoid the government having to force the bill through without a vote.

French Prime Minister Michel Barnier faces a significant political challenge as his budget proposal encounters resistance in a divided parliament. His coalition could collapse if a no-confidence motion is pushed by opponents,

French stocks and bonds came under fire on Wednesday, driving the premium the government pays for long-term borrowing to its highest since the euro zone debt crisis of 2012, as investors grew uneasy over the fate of the new government and its budget.