2024-07-03 22:33:00
Hoy 19:33
one’s perspective French parliament split following election Sunday Investors should not be encouraged, Reportedly because it means budget blockage Jane Foleycurrency strategist at Rabobank.
In an interview with Bloomberg TV on Wednesday, he told Tom McKenzie that the results of last weekend’s first round of elections put the far-right National Rally on a path to victory but may not garner the support of a majority of lawmakers who have produced Complacency.
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Financial warning on French parliament’s ‘indecisiveness’
“In the last days, Markets have been celebrating the possibility of no decision from the French parliamentFoley pointed out. “An indecisive parliament means it will be unable to make further progress in reducing the budget deficit, which means it might find itself in further difficulties with Brussels.”
Foley was referring to the European Commission’s condemnation of France and other countries last month. Under EU rules, member states must strive to maintain Deficit at most 3% of gross domestic productEven before parliamentary deadlock became less likely, the country was already far from reaching that limit.
“What we are seeing now in French politics only highlights the budgetary difficulties France is experiencing, which will continue following Sunday’s second-round election results,” he said.
The spread between France’s 10-year government bond and foreign debt yields narrowed this week following Sunday’s vote, following reaching its highest level since 2012 last month amid President Emmanuel Macron’s decision to call early elections. at the same time, The euro has rebounded from nearly two-month lows hit last week once morest the dollar.
However, moves in options markets suggest the euro’s rebound masks lingering pessimism over whether the currency can sustain its recent gains next month.
“In many ways, until recently, the market has been very adaptable to the budget issues in France, Italy and other countries,” he said. “As we approach the end of the year, the market cannot be too complacent regarding this.”
Translated by Carlos Aguirre.
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