With the French elections becoming a four way horse markets have more reason to fear a Le Pen victory. The scandal surrounding Francois Fillon could play into the hands of Le Pen if both were to make it through to the second round.
You have likely read numerous article on this website surrounding the upcoming French election, of which the first round will only be waiting until Sunday to occur. For those unaware or with a currency requirement that has only recently migrated to the top of your to-do-list, the main concern over the election is the potential win for Marine-Le-Pen. Her strong anti-EU stance is the key focal point for currency markets, and the balancing point on where the Euro’s value will journey to following the end of the second round of voting on May 7th.
Until recently, the Euro had been gaining value, as most polls had put Le Pen losing heavily in the second round of voting, when she was up against Macron, a popular centrist candidate.
However, a recent surge now means it is no longer a foregone conclusion that Le-Pen’s opponent in the second round will be Macron. Controversial candidate Fillon, who you may remember is under formal investigation for paying his wife hundreds of thousands of Euros for seemingly little or no work out of the public purse is now regaining his lost ground. There is also a far left-candidate Melenchon who is challenging for a place in the second round. The latest poll from Opinion Way sees the split for Macron, Fillon and Melenchon at 22%, 21% and 18% respectively. The previous confidence behind the Euro was that Le Pen would attract little additional vote percentage in the second round when it is whittled-down to just two candidates. However, now the uncontroversial centrist Macron may be replaced with a scandal-ridden Fillon or an extreme left winger Melenchon.
Suddenly a Le Pen victory is becoming another worrying possibility for currency markets when just last week a Macron victory seemed a foregone conclusion. The release of this poll at 11:56 BST yesterday coincided with the Euro’s cheapening yesterday afternoon.
Polls will continue to be released in the run up to the election. The recent result of the Turkish Referendum should fuel the kind of concerns towards the Middle-East which Le Pan panders to heavily. Unless market concerns are addressed with a widening gap in the polls, Euro buyers should enjoy improved buying rates over the next few weeks. Buyers may gain more from the anticipation surrounding the polls, rather than the results themselves. To ensure opportunities surrounding the election are not missed.
I strongly recommend detailing any short to medium term Euro buying requirements to their account manager here to plan how best to seize favourable movements in your favour. Euro sellers may be wise to move much sooner. In any event be sure to get in touch with our experts on 01494 725 353 or email me here to find out more on how these events could affect you.
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