presidential election

One month after a startling reversion by the G-20 finance ministers and central bankers, who during their latest meeting in Baden-Baden dropped a decade-long tradition of rejecting protectionism and endorsing free trade, pressured by Trump's delegate Steven Mnuchin, the IMF has done the same, and according to a communique from the IMF’s steering committee released on Saturday in Washington echoed the G-20 reversal, and said that officials “are working to strengthen the contribution of trade to our economies" while omitting a call from its last statement in October to “resist all for

Ahead of Sunday's first round of the French election, we have previously provided several perspectives on the political and economic outcomes, including a permutation matrix of all six possible outcomes in terms of "high" vs "low market risk" (from BofA), why the market may be too complacent about a Le Pen - Melenchon result (candidate approval variance is within the polling error), and that European stocks have completely failed to price in any adverse outcome (as DB observed yesterday).

Ahead of the first round of the French elections on Sunday, Deutsche Bank's equity strategist Sebastian Raedler again reminds his bank's clients and the seemingly unperturbed markets, that despite the  tightening of the poll numbers among the four front-runners, European equities show little sign of pricing in a meaningful political risk premium. In fact, as he notes below, European equities appear to not have priced in even a modest political risk discount.

France holds the first round of its Presidential election this weekend.

The big worry for the markets is the fact that anti-Euro candidate Marin Le Pen could potentially win.

Now, the polls show Le Pen as having NO chance of becoming Prime Minister. 

Of course, the polls also showed that BREXIT would not happen and Hillary Clinton had a 98% of becoming President.

We all know how those turned out.

President Trump tweeted on Friday morning that this week's "terrorist attack in Paris" will have "a big effect" on the country's presidential election set for Sunday.

Another terrorist attack in Paris. The people of France will not take much more of this. Will have a big effect on presidential election!

— Donald J. Trump (@realDonaldTrump) April 21, 2017