Emmanuel Macron, the centrist founder of the En Marche! movement beat National Front candidate Marine Le Pen by two votes to one in the second and final round of the French presidential elections on 7th May, in line with my core scenario. But for President-elect Macron (and arguably the other main party leaders), the hard work starts now. Macron is expected to appoint next week his Prime Minister and there has been much speculation. I would expect Macron to pick a head of government and approve cabinet ministers who will not polarise political opinion. The appointment of a “rainbow government” would likely help his party – recently renamed “La République En Marche” – secure the largest number of deputies at the forthcoming legislative elections on 11th and 18th June. If his party succeeds as opinion polls suggest – no means feat for a party which is only a year old and currently has no parliamentary deputies – this would in turn help reinforce Macron’s position and his choice of Prime Minister. However, polls suggest that La République En Marche may fail to secure a majority of the 577 seats in the National Assembly. If the party falls well short of that number, it would likely seek a loose coalition with either the Republican Party or less likely with the beleaguered Socialist Party, in my view. The National Front is likely to cement its position in French politics but it will need to reform itself and I would expect personnel changes and policy tweaks. Marine Le Pen fell well short of securing the presidency and this should have come as no great surprise as nationalist parties in other EU member states have also come up short. This is in line with my view that while nationalist/populist parties may have greater influence on the political landscape they will in most cases fail to exercise true power, let alone dismantle the eurozone and/or EU. Finally, opinion polls which predicted with great accuracy the second and in particular first round of the presidential elections, are back in favour – at least in France.

1. 1
2017 French elections – They think it’s all over…it isn’t
Emmanuel Macron, the centrist founder of the En Marche! movement beat National Front
candidate Marine Le Pen by two votes to one in the second and final round of the French
presidential elections on 7th May, in line with my core scenario.
But for President-elect Macron (and arguably the other main party leaders), the hard work
starts now. Macron is expected to appoint next week his Prime Minister and there has been
much speculation.
I would expect Macron to pick a head of government and approve cabinet ministers who
will not polarise political opinion. The appointment of a “rainbow government” would likely
help his party – recently renamed “La République En Marche” – secure the largest number
of deputies at the forthcoming legislative elections on 11th and 18th June.
If his party succeeds as opinion polls suggest – no means feat for a party which is only a
year old and currently has no parliamentary deputies – this would in turn help reinforce
Macron’s position and his choice of Prime Minister.
However, polls suggest that La République En Marche may fail to secure a majority of the
577 seats in the National Assembly.
If the party falls well short of that number, it would likely seek a loose coalition with either
the Republican Party or less likely with the beleaguered Socialist Party, in my view.
The National Front is likely to cement its position in French politics but it will need to
reform itself and I would expect personnel changes and policy tweaks.
Marine Le Pen fell well short of securing the presidency and this should have come as no
great surprise as nationalist parties in other EU member states have also come up short.
This is in line with my view that while nationalist/populist parties may have greater
influence on the political landscape they will in most cases fail to exercise true power, let
alone dismantle the eurozone and/or EU.
Finally, opinion polls which predicted with great accuracy the second and in particular first
round of the presidential elections, are back in favour – at least in France.

2. 2
Emmanuel Macron wins second round in landscape-changing presidential election
Emmanuel Macron, the founder of the centrist En Marche! movement, won the second and final round of
the French presidential elections on 7th
May with 66.1% of the popular vote, with National Front candidate
Marine Le Pen garnering 33.9%, according to final official numbers published by the Conseil
Constitutionnel (Constitutional Council) on 10th
May. The outcome of the vote was in line with my core
scenario (see 7 reasons why Macron will become President and market implications, 25 April 2017, The
Ultimate Guide to the 2017 French Elections – Part IV, 13 April 2017 and Going Dutch 17 March 2017).
These presidential elections have challenged many long-held assumptions and significantly altered
France’s political landscape which will likely be key in the forthcoming legislative elections as I discuss
below. At 39 years old, Macron is France’s youngest ever President (see Figure 1) and the first centrist
president since Valéry Giscard d'Estaing who won the 1974 elections as the Union for French Democracy’s
candidate (see Figure 2).
Perhaps more significantly, Macron is the first ever presidential candidate to win an election without the
backing of a major party, with Macron having launched only a year ago his En Marche! movement – which
has in recent days been renamed La République En Marche (The Republic on the Move). While the
National Front candidate Marine Le Pen fell well short in the second round of being elected president, it
was by far the ever strongest performance by a National Front candidate (see Figure 12).
Figure 1: Age ain’t nothing but a number Figure 2: Macron is first centrist President in over
40 years
Source: Conseil Constitutionnel Source: Conseil Constitutionnel
But these elections also revealed the extent to which voters are divided across the political spectrum. Four
candidates won 19% or more of the popular vote in the first round of voting on 23rd
April (see Figure 3) and
in the second round a record high 34% of registered voters failed to vote or returned blank/void ballot
papers (see below and Figure 9).
30
40
50
60
70
80
Age of Presidents (years)
40
50
60
70
80
90
Second round winner, % of votesChirac
Chirac
Giscardd'Estaing
Mitterrand
DeGaulle
Mitterrand
Sarkozy
Hollande
Pompidou
Republican
Socialist
Centrist
Macron
Chirac

3. 3
Figure 3: First round made it clear that French electorate is very divided
Source: Conseil Constitutionnel
The quasi-duopoly which the Republican and Socialist parties have enjoyed for four decades has been laid
bare. For the first time in a presidential election, neither the Republican or Socialist party candidate made it
to the second round and for the first time ever the Socialist Party candidate was outside the top three, with
Benoît Hamon coming in fifth with a meagre 6.4% of the popular vote.
Next up – Macron needs to appoint a Prime Minister and approve government ministers
Macron, President elect, will be officially inaugurated on 14th
May to become France’s tenth president under
the Fifth Republic and François Hollande will step down (see Figure 4).
0
5
10
15
20
25
French presidentials - First round, % of valid votes cast

4. 4
Figure 4: First stage of the French presidential elections over, focus now on legislative elections
Source: Conseil Constitutionnel, Assemblée Nationale
President Macron, the head of state, will then appoint his prime minister, the head of government, and he
can choose whomever he wants. While prime ministers are usually chosen from amongst the ranks of the
National Assembly, on rare occasions the President has selected a non-officeholder because of their
experience in bureaucracy, the Foreign Service or private sector (Dominique de Villepin, for example,
served as Prime Minister from 2005 to 2007 without ever having held an elected office). The Prime Minister
will then draw up a list of government ministers which Macron will have to approve (see Figure 5).
SECOND ROUND of French Presidential elections
Emmanuel Macron wins 66.1%, Marine Le Pen 33.9%
Macron President Elect
Macron to be officially inaugurated
Term of President François Hollande officially ends
Sunday 7 May
14 May
Conseil Constitutionnel to officially declare final result of
second round and Macron as winner of presidential elections
10 May
FIRST ROUND of French National Assembly elections11 June
SECOND ROUND of French National Assembly elections18 June
Deadline for parties to present candidates for National
Assembly elections
19 May
Macron to reportedly announce 450 of the 577 candidates
which En Marche! will field in legislative elections
11 May

5. 5
Figure 5: The checks and balances on French executive and legislative powers
Source: Assemblée Nationale, Conseil Constitutionnel
Macron has said that he already knows whom he will appoint as appoint as Prime Minister and there has
been much speculation about the possible candidates. They reportedly include, in alphabetical order:
- François Bayrou, the centrist leader of the Modem who gave this support;
- Xavier Bertrand, a Republican Party member and former minister;
- Jean-Yves Le Drian, the current Minister of Defense;
- Richard Ferrand, a Socialist Party deputy;
- Sylvie Goulard, a member of the En Marche party and a former MEP;
- Anne-Marie Idrac, the former Secretary of State under Presidents Chirac and Sarkozy;
- Christine Lagarde, the current Managing Director of the International Monetary Fund (IMF)
- Bruno Le Maire, a Republican Party deputy who has expressed a desire to join En Marche; and
- Edouard Philippe, the Republican Havre deputy-mayor.
But Macron’s choice of Prime Minister is potentially constrained by the fact that under the French
Constitution the National Assembly (the lower house of parliament) has the power to dismiss the Prime
Minister and Council of Ministers. While the President has in turn the power to dissolve the National
Council of Ministers
Prime Minister
(Head of Government)
President Macron
(Head of State)
National Assembly
(lower house of parliament)
appoints
Can dismiss in no
confidence vote
Proposes a list of
ministers to the President
En Marche! will try to win a majority in the 577-seat
National Assembly
Approves list of
ministers put forward
by Prime Minister
President Macron can dissolve National Assembly after having consulted Prime
Minister and presidents of both houses of parliament
Can dismiss in no
confidence vote

6. 6
Assembly, this has only happened once and in practice the choice of Prime Minister must reflect the will of
the majority in the Assembly.
Macron’s next big challenge therefore is for his fledging party to win a majority of the 577 seats in the
National Assembly elections scheduled to take place over two rounds on 11th
and 18th
June (see Figure 6).
Macron could of course hedge his bets to avoid the risk of the National Assembly dismissing his Prime
Minister by appointing a Prime Minister which he thinks will enjoy majority support regardless of whether La
République En Marche manages to secure a parliamentary party. This leads me to believe that Macron will
opt to for a Prime Minister who does not polarise political opinion and is therefore not too far to the left or
the right on the political spectrum.
Figure 6: National Assembly elections will be held over two rounds on 11th and 18th June
Source: Assemblée Nationale: Conseil Constitutionnel
Macron likely to seek a rainbow government and party
Macron’s La République En Marche party is only a year old and currently has no deputies in the National
Assembly where a Socialist Party led coalition enjoys a slim majority (see Figure 7). Macron has said that
this party would field 577 candidates taken from across the political spectrum, including independents and
politicians from the mainstream Socialist and Republican parties, and from civil society. La République En
Marche will reportedly announce on 11th
May the names of 450 of its 577 candidates (the deadline for all
parties to officially announce their candidates is 19th
May – see Figure 4).
A number of senior politicians from these parties, which have for decades enjoyed a near duopoly over
French politics, have already publicly announced that they would join La République En Marche. These
include former Prime Minister Valls who lost the second round of the Socialist Party primaries in January
although La République En Marche officials have showed little enthusiasm for Valls’ defection. Conversely,
Republican Party member Christian Estrosi said he had been offered a cabinet post but had declined and
would instead run for mayor of Nice.
In the first round, a candidate must obtain a majority of the votes representing at least 25% of
registered voters in order to be elected (each voter, who must be aged 18 or over and of French
nationalist, gets one vote).
Otherwise, candidates which obtained the votes of at least 12.5% of registered voters in the first
round proceed to a second and final round (if no candidate fulfils this condition, the two candidates
who won the most votes in the first round proceed to the second round). The candidate with the most
votes in the second round is elected deputy.

7. 7
Figure 7: Composition of National Assembly will likely look radically different after June elections
Source: Assemblée Nationale
The scale of Macron’s project is unprecedented, with the previous six presidents hailing from either the
Socialist or Republican parties (see Figure 2) which were all but guaranteed to be the largest or second
largest party in the National Assembly. Even if La République En Marche successfully fields 577
candidates – in itself no mean feat – securing a majority of 289 seats is a tall order.
Very difficult to predict how many parliamentary seats parties will win
Opinion polls for the first and second round of the presidential elections proved very accurate (see below).
However the modalities of the first and second round of the legislative elections (see Figure 6), likely
political alliances and uncertainty about actual voter turnout ultimately make it very difficult to translate
percentages of popular votes (whether actual or polled) into actual numbers of deputies. The British
general elections, which are run on a first-past-the-post basis, are a point in hand. In the 2015 elections the
ruling Conservative Party won a far larger share of the 650 House of Common seats than polls had
suggested was likely (see Conservatives win landslide elections, 8 May 2015).
Recent polls suggest that abstentions and undecided voters for the legislative elections could be as high as
45%, which seems feasible given the low turnout in the arguably more voter-friendly presidential elections.
While Macron obtained 66.1% of valid votes in the second round of the presidentials, voter turnout of
74.6% was the second lowest ever and well below the 81.6% average recorded between 1969 and 2012.
Put differently one in four registered voters simply did not turn up to vote (see Figure 8). Moreover, the
Socialist Party (49.2%)
Radical Party of the Left (2.8%)
Republican Party (34%)
New Centre (1.6%)
National Front (0.3%)
Green Party (1.9%)
France Arise (0.5%)
Leftist Forces (0.3%)
Not registered (1.6%)
Union of Democrats and Independents (3.1%)
Communist Party (1.4%)
Other (3.3%)
Current composition of French National Assembly (% of total delegates)

8. 8
share of blank and void votes (8.6%) was the highest ever recorded and by a large margin (see Figure 9).
As a result, over a third of the registered electorate (34% to be exact) did not vote or returned a blank/void
vote – a clear indication of the level of voter disaffection with the second round finalists.
Figure 8: An above average 1-in-4 voters did not
vote in second round of presidentials…
Figure 9: …and nearly one in ten registered voters
returned a blank or void vote
Source: Conseil Constitutionnel Source: Conseil Constitutionnel
In effect, only 43.6% and 22.4%, respectively, of registered voters gave their support to Macron and Le Pen
on 7th
May (see Figure 10).
Figure 10: Fewer than 44% of registered voters voted for Macron and that ratio was only 22% for Le Pen
Source: Conseil Constitutionnel
0
5
10
15
20
25
30
35
1969-2012
av: 18.4%
Voter absention rate (%)*
Second round presidential elections
0
1
2
3
4
5
6
7
8
9
1969-2012
av: 3.4%
Blank and invalid votes, % of registered voters
Second round presidential elections
25.4
6.4
2.2
43.6
22.4
Abstentions
Blank votes
Null votes
Macron
Le Pen
Second round 2017 presidential elections, % of registered voters

9. 9
Opinion polls suggest La République En Marche may need to form broader coalition
The geographical breakdown of votes from the first round of the presidential elections and recent polls of
voters’ intentions in the legislation elections suggest that La République En Marche may struggle to secure
a parliamentary majority.
According to Ministry of Interior figures for the first round of the presidential elections, Macron came first in
240 circumscriptions, Le Pen in 216, Mélenchon in 67 and Fillon in 54. The polling agency L’Internaute
estimates that this would translate into 427 En Marche candidates making it to the second round of voting,
while the National Front, France Insoumise and Republican Party would respectively have 295, 237 and
227 candidates. It is unclear whether these numbers would translate into En Marche winning the largest
number of seats, let alone a parliamentary majority. Recent polls conducted since the second round
suggest that voters’ intentions have not changed materially since the first round vote (see Figure 11). But
again converting these voting intentions into actual deputies is an exercise fraught with difficulty.
Figure 11: Voting intentions have not changed much since the presidential first round on 23rd April
Source: Conseil Constitutionnel, Kantar-Sofres, Ifop Fiducial
Note: * Average of Kantar-Sofres and Ifop Fiducial polls (both conducted on 4-5 May 2017); ** Green Party did not field a
candidate in the presidential elections
Various polls and internal party estimates conclude that République En Marche could win 200-285 seats,
the Republican Party 100-150, the National Front 20-70, the Socialist Party 20-60 and France Insoumise 6-
23. But this does not take into account the possibility of candidates from two (or more) different parties
forming an alliance in the second round.
0
5
10
15
20
25
30
Macron / En
Marche
Le Pen / National
Front
Fillon /
Republican Party
Mélenchon /
France
Insoumise
Hamon / Socialist
Party
Green Party
Opinion polls for first round of National Assembly elections, % of voting intentions*
Outcome of first round of presidential elections (% of valid votes)**

10. 10
If La République En Marche falls just short of a parliamentary majority, it will likely seek to form a broader
coalition with the Republican Party or less likely with the beleaguered Socialist Party (in the same way that
President Hollande’s Socialist Party, which has 284 seats, has formed loose alliances with other centre-left
parties). But even if La République En Marche falls well short of 289 deputies, the National Assembly is
likely to be very fractured along political lines and would likely struggle to cobble the required majority to
dismiss Macron’s Prime Minister.
National Front likely to cement its position in French politics…if it can reformitself
The National Front currently only has two deputies in the National Assembly but opinion polls suggest it will
significantly increase this number. It will not even come close to being the largest party, let alone secure a
parliamentary majority, but if the National Front can successfully regain some momentum in coming weeks
it will likely further cement its position as a major political force.
The failure of Marine Le Pen to come even close to being elected has seemingly kick-started an in-depth
review of the National Front’s tactics and strategies ahead of the legislative elections. The party’s
leadership has hinted at a full-scale rebranding, including re-naming the Party to emphasise its France-first
credentials.
I would expect the party to once again distance itself from the more extreme views and policies favoured by
its founder Jean-Marie Le Pen, with Marine Le Pen’s lurch to the right in the final weeks of campaigning
having seemingly backfired. Moreover, I would expect Marine Le Pen tone down her long-held goal of
taking France out of the eurozone and the EU. Already in the weeks before the second round she had
toned down her anti-Europe rhetoric as it became obvious that French voters did not share their British
counterparts’ penchant distance itself from the EU. It was ultimately too little too late and if anything Le
Pen’s apparent u-turn and muddled policy of a hybrid French Franc and euro currency regime likely cost
her votes in the second round.
This repositioning may well also result in further senior personnel changes. Marion Maréchal Le Pen,
Marine’s niece and the only National Front deputy in the National Assembly, announced on 10th
May that
she was leaving the party and politics to likely start a career in business. Her more extreme stance on
immigration but more pragmatic view of France’s membership of the eurozone and EU had put her at odds
with Marine Le Pen. The loss of Marion Maréchal Le Pen – who had been touted as a likely future leader of
the party and presidential candidate – has put in perspective the challenges facing the National Front.
Socialist Party in disarray…mimicking downfall of Socialist Parties across Europe
The Socialist Party is likely to be biggest loser in the June elections, with polls predicting that it will at best
only be the third largest party after La République En Marche and the Republican Party. It could
conceivably fall further down the pecking order behind the National Front and a far-left coalition led by
Mélenchon’s France Insoumise party.

11. 11
The Socialist Party has lost much ground under the unpopular presidency of François Hollande and former
Socialist Prime Ministers Jean-Marc Ayrault (2012-2014), Manuel Valls (2014-2016) and Bernard
Cazeneuve (2016-2017). The Socialist presidency and government have ultimately struggled to address
economic issues (including still high unemployment rates and tepid growth) and domestic policy issues
(including immigration and national security) and been criticised for playing second fiddle to Germany on
European issues. The party’s downfall mimics the collapse of the British Labour Party led by Jeremy
Corbyn, which is expected to lose many parliamentary seats in the 8th
June elections, and of the Dutch
Socialist Party which is now only the seventh largest party with 6% of deputies following parliamentary
elections in March.
French presidential election post-mortem – Nationalism and opinion polls
Nationalist parties gaining ground…but not power
Marine Le Pen won a third of the vote – nearly twice the share of votes which her father and National Front
leader Jean-Marie Le Pen won in the second round of the 2002 presidential elections (see Figure 12). Le
Pen, who has long promoted a nationalist agenda with a domestic security and anti-immigration bias and in
recent years campaigned in favour of France leaving the eurozone and European Union, has clearly tapped
into French voters’ disaffection with mainstream politics and inclination for France-focussed policies. This is
in line with the view I expressed in early 2016 that "the immigration issue is likely to further divide EU
countries and fuel nationalism" (see What to expect in 2016 - same, same but worst, 19 January 2016).
Figure 12: Marine Le Pen won nearly twice the
share of votes her father won in 2002 elections…
Figure 13: …but her share of the vote was still very
low by historical standards
Source: Conseil Constitutionnel Source: Conseil Constitutionnel
0
5
10
15
20
25
30
35
40
1988 1995 2002 2007 2012 2017
National Front candidates
% of votes in French presidential elections
(shaded are second round percentages)
Jean-Marie Le Pen
Marine Le Le Pen
10
15
20
25
30
35
40
45
50
55
% of votes won by second round runner-up
in French presidential elections
1965-2012 av: 43.4%

12. 12
However, Marine Le Pen fell well short of securing the presidency, as I argued would likely be the case
(see EM currencies, Fed, French elections and UK reflation "lite", 25 November 2016). Her 33.1% share of
the vote was the second lowest ever percentage won by the runner-up in a French presidential election and
below the 43% historical average (see Figure 13). This should have come as no great surprise as
nationalist parties in other EU member states have also recently come up short.
 In Austria, the candidate of the nationalist Austrian Freedom Party, Norbert Hofer, lost a re-run of the
4th
December 2016 presidential elections, despite having won the first round and come very close in
the (original and later cancelled) second round.
 In the Netherlands, the nationalist Party for Freedom led by Geert Wielders came second in the 15th
March parliamentary elections with 20 seats – a gain from 12 seats (and 15 seats after the 2012
elections). But this was well short of expectations based on polls showing 25% support (and about 37
seats) and left the party a long way from being able to lead a ruling coalition let alone a parliamentary
majority (75 seats).
While there is little doubt that the political, economic and social status-quo is being tested and nationalism
is on the ascendancy in Europe, nationalist and/or populist parties are still falling short and failing to cause
widely-forecast major political upsets. Voters are still seemingly reluctant to elect nationalist parties and
politicians to the highest political echelons. This is in line with my view that while nationalist/populist parties
may have greater influence on the political landscape they will in most cases fail to exercise true power, let
alone dismantle the eurozone and/or EU (see Nationalism, French presidential elections and the euro, 18
November 2016, and Black swans and white doves, 8 December 2016).
Opinion polls back in favour – in France at least
Macron’s convincing two-to-one margin of victory over Le Pen was in line with opinion polls which in the
days before the second round had Macron on 62% and which had consistently showed support for Macron
around 60% (see Figure 14). The gap between the actual outcome and the latest opinion polls – about +/- 4
percentage points – was only slightly higher than the typical +/-2% margin of error on such polls. This
supports my long-held view that French opinion polls remain accurate predictors of presidential elections
(see The Ultimate Guide to the 2017 French Elections – Part III, 5 April 2017).

13. 13
Figure 14: Opinion polls once again accurately forecast the second round of a French presidential election
Source: Les Echos poll, Conseil Constitutionnel
Despite opinion polls having forecast with great accuracy the outcome of the first round of the French
elections on 23rd
April (see Figure 15) and the second round of previous presidential elections, there was
much debate about whether they could be trusted. In the days, weeks and months numerous scenarios
were put forward whereby Le Pen would beat Macron, albeit by a narrow margin. Most of the reports
forecasting a shock win for the National Front leader were premised on opinion polls under-estimating the
impact of a low voter turnout and the likelihood that undecided voters would gravitate towards Le Pen
rather than Macron.
30
35
40
45
50
55
60
65
70
16-Mar 22-Mar 28-Mar 03-Apr 09-Apr 15-Apr 21-Apr 27-Apr 03-May
Macron Le Pen
Voting intentions for second round of French presidential elections, %
Actual:
66.1%
Actual:
33.9%

14. 14
Figure 15: Opinion polls very accurately forecast the first round of the French presidential elections
Source: Les Echos, L’Internaute, Conseil Constitutionnel
But this simply did not materialise. Voter turnout was low (see above) but this seemingly conveyed no
advantage to Le Pen, pouring cold water on the idea that her supporters were somewhat more committed
and more likely to vote than Macron’s supporters. Moreover, there is little evidence that undecided voters
gravitated towards Le Pen or that voters who said they would support Macron actually voted for Le Pen on
Election Day. In effect, those polled were an accurate reflection of how 31.4 million voted. If anything, it
would seem that polls slightly underestimated undecided voters’ propensity to vote for Macron.
5
10
15
20
25
30
16-Mar 21-Mar 26-Mar 31-Mar 05-Apr 10-Apr 15-Apr 20-Apr
Le Pen
Macron
Fillon
Mélenchon
Hamon
Others*
First round presidential elections - Actual (crosses) versus voting intentions, %
x
x
x
x
x
x