Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Former Interior Minister Gérald Darmanin, now a deputy for the centrist Rennaisance party supportive of President Emmanuel Macron, has labelled the draft budget of PM Michel Barnier 'unacceptable'. Gov't officials said on 2 Oct that EUR40bn in spending cuts and EUR20bn in tax hikes would be required to get the budget deficit to the 2025 target of 5% of GDP. Speaking to Franceinfo Darmanin said "I do not agree with his budgetary trajectory...What was missing in the Prime Minister's general policy speech were the reforms he was going to make, we must explain what we are going to do with the country." The gov't is due to present the details of the budget on 9 Oct.
- Darmanin did not go as far as to say that he would vote against the budget, saying only that "I will not vote for a tax increase," leaving the door open for an abstention.
- The former Public Accounts minister is not the only deputy from the Macronist Ensemble alliance to state their opposition to tax increases. This could present a dilemma for the gov't as it looks to get the budget through parliament.
- The Barnier gov't, formed by the three blocs of the pro-Macron Ensemble and the conservative Republican Right commands 212 seats in the 577-member National Assembly (see chart below). The leftist New Popular Front (NFP) has 193 seats. Should Ensemble deputies vote against, or even abstain, en masse it could leave the gov't vulnerable to defeat even if the far-right National Rally abstains as well.
Chart 1. National Assembly, Seats
Source: MNI, assemblee-nationale.fr
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.