{"id":8298,"date":"2024-06-17T09:31:29","date_gmt":"2024-06-17T08:31:29","guid":{"rendered":"https:\/\/hamiltoncourtfx.com\/?p=8219"},"modified":"2024-06-17T09:31:29","modified_gmt":"2024-06-17T08:31:29","slug":"french-election-special","status":"publish","type":"post","link":"https:\/\/hamiltoncourtfx.com\/es\/french-election-special\/","title":{"rendered":"French Election Special"},"content":{"rendered":"
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Macro Monday<\/strong><\/h5>\n
France’s GDP currently stands at 2.78 trn, making it the second largest economy in the Eurozone.<\/h5>\n<\/div>\n <\/div>\n <\/div>\n <\/div>\n<\/div>\n\n\n
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French Elections<\/h2>\n <\/div>\n
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This morning marks the first official day of campaigning in France, with the legislative elections just around the corner.<\/p>\n

Here, the French electorate will decide on the makeup of the 577 deputies of the National Assembly, over two rounds.<\/p>\n

During the first-round (30 June) candidates must win over 50% of the vote share, alongside 25% of the number of registered votes.<\/p>\n

Assuming no candidate gets both of the above, the two candidates with the highest vote share (and any that receive above 12.5% of the registered vote share) advance to the second round (held on 7 July). There, the candidate with the highest number of votes wins the seat.<\/p>\n

A party \u2013 or alliance \u2013 would therefore need 290 deputies to form a government.<\/p>\n

Presently, Marine Le Pen\u2019s far-right Eurosceptic Rassemblement National party is polling at 33% ahead of Macron\u2019s centrist and pro-European Renaissance party which has 19%, having dominated the European Union elections earlier this month. Elsewhere, the former party of Jacques Chirac and Nicolas Sarkozy \u2013 the centre-right Les R\u00e9publicains \u2013 is polling at just 7%.<\/p>\n

With Macron due to stand down from the Office of the Presidency in 2027, pollsters suggest that Le Pen could well take his place after the next Presidential election.<\/p>\n <\/div>\n <\/div>\n <\/div>\n<\/div>\n\n

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Markets Consider RN\u2019s Fiscal Plans<\/h2>\n <\/div>\n
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With their position in the polls continuing to dominate headlines, markets are considering the implications that Marine Le Pen\u2019s far-right Rassemblement National party could have on Paris\u2019 fiscal policies.<\/p>\n

For example, analysis shared by Aster\u00e8s Research in the FT identified that RN\u2019s fiscal loosening measures announced during the last election would rise France\u2019s peak annual public deficit as a share of GDP by an extra 3.9 percentages points.<\/p>\n

Given that is more than double the impact that Liz Truss\u2019 October 2022 fiscal loosening announcements had, concern is building that such polices could put insurmountable pressure on France\u2019s finances and borrowing costs.<\/p>\n

It\u2019s worth noting that France already has a budget deficit of around 5% of GDP – the second highest in the Eurozone and over three times that of Germany \u2013 with many therefore arguing that Paris should look towards fiscal tightening to shore up their financial position.<\/p>\n

While the existing government has already tried to address some of these issues, policies like increasing the state pension age have been deeply unpopular with popular protests unfolding across Europe\u2019s second largest country.<\/p>\n <\/div>\n <\/div>\n <\/div>\n<\/div>\n\n

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French Stocks Under Pressure<\/h2>\n <\/div>\n
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With political and economic uncertainty looming large in France, the CAC 40 index extend losses on Friday, retreating just shy of 3% over the session. By Friday\u2019s close, the French blue-chip index was trading at around five-month lows, having suffered its worst week in well over two years. Stocks in the financial services sector came under particular pressure on Friday, with France\u2019s biggest bank BNP Paribas down 3.5% on the day, given their exposure to France\u2019s government debt and the possibility of RN toying with putting windfall taxes on some in the space.<\/span><\/p>\n <\/div>\n <\/div>\n <\/div>\n<\/div>\n\n

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Looking Ahead<\/h2>\n <\/div>\n
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Alongside election coverage both sides of the Channel and across the Atlantic, this week\u2019s major data releases include a string of inflation data with the Eurozone\u2019s released tomorrow and the UK’s on Wednesday. Markets will also look towards interest rate decisions held on Wednesday, with the PBoC, SNB and BoE all holding monetary policy meetings.<\/span><\/p>\n <\/div>\n <\/div>\n <\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"

Macro Monday, first official day of campaigning in France, RN party’s fiscal plans leaves markets considering implications, political and economic uncertainty leaves French stocks under pressure, and what’s happening this week.<\/p>","protected":false},"author":15,"featured_media":5701,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"rp-language":[16],"class_list":["post-8298","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-morning-updates","rp-language-en_gb"],"_links":{"self":[{"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/posts\/8298","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/comments?post=8298"}],"version-history":[{"count":0,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/posts\/8298\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/media\/5701"}],"wp:attachment":[{"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/media?parent=8298"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/categories?post=8298"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/tags?post=8298"},{"taxonomy":"rp-language","embeddable":true,"href":"https:\/\/hamiltoncourtfx.com\/es\/wp-json\/wp\/v2\/rp-language?post=8298"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}