French President Emmanuel Macron has opted to appoint a new prime minister instead of calling snap elections, a move that gives his administration breathing room as it seeks to steady France’s political and fiscal situation.
Headline on this earlier:
Wall Street Journal with more now:
Macron had been weighing dissolving the National Assembly following Prime Minister Sébastien Lecornu’s sudden resignation on Monday amid disputes over cabinet appointments. Instead, he instructed Lecornu to hold fresh talks with France’s divided parties to see whether a workable government could be formed to pass a budget before year-end.
After reporting back to the Elysée on Wednesday, Lecornu said progress had been made and that Macron could name a new prime minister within two days — a plan later confirmed by the presidency. “I told the president that the prospect of dissolving parliament was receding,” Lecornu said on national television, expressing confidence that “a path forward is possible.”
—
Some market implications to eye:
-
FX: Political stability could offer mild support for the euro, though fiscal uncertainty remains a drag.
-
Bonds: Averted elections reduce near-term volatility in French sovereign debt markets.
-
Equities: Calmer political backdrop may reassure investors but fiscal challenges linger.
