Barclays: French election is too close to call, deficit could increase in any case

On June 18th, according to a report by Barclays analysts Silvia Ardagna and Mariano Cena, opinion polls before the French legislative elections showed that President Macron's parliamentary party is being squeezed by the left-wing alliance New Popular Front and Le Pen's National Rally. Although the outcome is still uncertain, the most likely result is a deadlock or a co-governance with the far-right in parliament. Economists point out, 'We believe the latter is more negative for the market, EU institutions, and the prospect of further fiscal and political integration in EU member states, at least in the long run.' They added that a common point of the left and right alliances is that their policies will lead to an increase in the deficit, including the New Popular Front lowering the retirement age to 60 and the National Rally reducing the value-added tax rate on energy products.