2024-07-04 11:45:28
In France, at the end of the campaign for the second round of legislative elections, economic issues have almost disappeared from the radar. Off, but still under suspicion, they will quickly be recalled by the next government.
Since Monday, topics that affect the French daily have taken a back seat. Purchasing power is, for example, important to refer to electoral plans. Before the first round, competing groups compete on this theme with detailed solutions: increase taxes for the poor or lower for everyone. The promise already seems to be demonetized. Also on the arguments of experts on the reliability of the programs of the two big opposition forces, the New Popular Front for the left and the National Rally for the far right.
Read againAn increase in purchasing power is at the heart of the legislative battle
The time for politics, fear for some, dream for others, has seen the National Rally de Matignon, this is what represents the forces facing the electoral statistics. This is what removes all economic questions. These questions can quickly boomerang back the day after the second round.
The first reference: the reaction of the stock market the day after the first round
The Paris stock market rebounded strongly on Monday. Clearly, investors think that the worst is over: the worst for the markets is a victory for the National Rally, a group that causes great fear over the left in financial circles. Because the RN is the third party hostile to Brussels. Once in power, this group could complicate possible agreements from the European Union in the event of a financial storm. The RN is therefore a red rag for the stock market. This fear suggests what could happen if a far-right party wins a majority. Another emerging scenario, the absence of a majority, does not really guarantee products.
Read againLegislative elections in France: why is the RN offering part of its program?
The pressure on public spending
With an increasingly dangerous deficit, to more than 5% in 2023 and a debt of more than 3,000 billion euros, the state of public finances now makes France a country under surveillance. From Brussels and investors. Whatever the outcome of the elections, the French debt market will be troubled in the coming months, while the stable government shows its roadmap for managing public finances. The topic is not available in this quick campaign. Very dry, it is true, and above all it is not very noticeable to be approved by the candidates.
Read againLegislative elections in France: the left outlines its budget, including a climate tax and a minimum wage of 1,600 euros
A wait-and-see business
The outcome of the vote will also have a definite impact on the life of businesses. Uncertainty that does not please the markets can also discourage business leaders. If it continues, hiring plans, like investment projects, will probably be postponed, either among French or foreign companies, or among families planning to buy a car or a house. Private sector activity contracted slightly in June, noted the company S and P Global, this gives a forecast of what awaits the French economy in the coming months. He hasn’t said his last word!
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