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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.
Executive Summary
- Germany is set for a period of political uncertainty following the 26 September federal election, with an unprecedented three-party coalition likely to be required to form a majority government. The negotiation process could take several months before a deal is reached.
- The end of the Merkel era could see her centre-right Christian Democratic Union ousted from power, with the centre-left Social Democrats (SPD) riding high in opinion polls. The SPD's Olaf Scholz sits as favourite to take over from Merkel.
- The most likely outcome of the coalition formation process is a 'traffic light' coalition, formed by the SPD, the environmentalist Greens, and the pro-business liberal Free Democrats (FDP). The other likely option is a 'Jamaica' coalition involving the CDU-CSU, Greens, and FDP.
- There is the prospect of a three-party leftist government coming to power comprising the SPD, Greens, and far-left Die Linke, a successor party to the defunct communist East German SED. This coalition would bring the most change in policy terms, with a tightening of housing and labour market regulations, a closer relationship with Russia, and the potential for a cap on rental properties.
Full article PDF attached below:
MNI POLITICAL RISK ANALYSIS – Germany Election Preview.pdf
Chart 1. German Bundestag, 2017 Election Results, 2021 Projection
Source: Dawum.de, MNI. N.b. Dawum.de forecast does not include potential overhang mandates, meaning only 598 seats apportioned.
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.
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