According to Francesco Pesole at ING, the Paris appeal court's ruling on Marine Le Pen’s embezzlement case is expected to have a greater impact on French politics than on financial markets, as investors have already largely priced in a potential National Rally (RN) victory under either Le Pen or Jordan Bardella, assuming fiscal prudence is maintained [1]. Pesole notes that both Le Pen and Bardella are currently leading in the polls against other potential candidates, with the possibility that a reversal of Le Pen's ban could further strengthen the RN and shift expectations towards her candidacy over Bardella [1].
Despite the political significance, ING anticipates limited reaction in the Euro (EUR), with EUR/USD potentially retesting 1.1400 but overall low volatility expected due to the absence of strong economic data or central bank actions [1]. Pesole suggests that only a surge in support for left-wing candidates like Jean-Luc Mélenchon would be likely to seriously unsettle French government bonds (OATs) and the euro at this stage [1].
The analysis further indicates that markets expect either Le Pen or Bardella to deliver sufficient fiscal prudence, which would help contain bond volatility, drawing a parallel to Giorgia Meloni’s approach in Italy [1]. ING does not foresee significant market movement today, reinforcing the view that the event's market potential is limited [1].
CONCLUSION
ING expects the Paris court ruling on Marine Le Pen’s eligibility to have minimal market impact, as investors have already priced in a National Rally victory with fiscal discipline. The euro and French bonds are likely to remain stable unless there is a notable shift in support towards left-wing candidates.