FRANCE: Bayrou Gov't Safe In Today's Votes; Gov't Expects Budget Adopted Mid-Feb

Feb-05 15:12

The National Assembly has started debate on two censure motions against the gov't of PM Francois Bayrou. Once speakers from the groups in parliament and the gov't have taken place votes will be held. These votes carry no threat to the gov't given that the centre-left Socialist Party (PS) and the far-right Rassemblement National (National Rally, RN) will not back the motions, denying them a majority. 

  • The motions were advanced by the far-left La France Insoumise (LFI) following Bayrou's use of Art. 49.3 of the constitution to push the budget through the National Assembly without a vote. LFI figurehead Jean-Luc Melenchon said the leftist 'New Popular Front' alliance that won the most seats in the 2024 election had "one party less" after the PS confirmed its intention not to vote to remove Bayrou.
  • In the opening speech, LFI lawmaker Aurélie Trouvé calls the budget 'the most austere of the 21st century'. PS deputy Emmanuel Grégoire says the budget can be a "budget of less suffering than that of Michel Barnier." Barnier was ousted in Dec 2024 with the PS voting for the censure of his gov't after he used Art 49.3.
  • Grégoire says that the lack of censure does not indicate support for the budget, and that the PS will remain in opposition.
  • Earlier today, gov't spox Sophie Primas said following a meeting of the Council of Ministers that if today's censure motions fail, "we should have a budget adopted by mid-February."

Historical bullets

JPY: Exchange traded Option

Jan-06 15:11

JPYUSD (7th Feb) 58.00p sold at 0.035 in 2.7k.
 

US TSYS: Post Durables/Cap-Goods Orders React

Jan-06 15:04
  • Treasuries  drift near early session lows after mixed data: Durable Goods orders come out lower than expected, Cap Goods Orders higher than expected.
  • The Mar'25 10Y futures contract trades -5.5 at 108-15 (108-12 overnight low), focus on initial round number technical support at 108-00 & 1.500 proj of the Oct 1 - 14 - 16 price swing.
  • Curves holding steeper with the short end outperforming, 2s10s +2.642 at 34.110 (May '22 highs), 5s30s +1.050 at 40.787.

MNI: US NOV FACTORY ORDERS -0.4%; EX-TRANSPORT NEW ORDERS +0.2%

Jan-06 15:00
  • MNI: US NOV FACTORY ORDERS -0.4%; EX-TRANSPORT NEW ORDERS +0.2%
  • US NOV DURABLE ORDERS -1.2%
  • US NOV NONDEFENSE CAP GOODS ORDERS EX AIRCRAFT +0.4%