French President Emmanuel Macron has announced a temporary administration after the resignation of Gabriel Attal, emphasizing the need for unity to benefit the French people. This interim government can handle urgent matters but cannot convene cabinet meetings or make fiscal decisions.
Ministers will vote for the head of the National Assembly, crucial in legislative debates and crises. The setup is essential, as judicial review may challenge its decisions due to limited powers. Political stability in France remains uncertain, with Macron’s recent decision to call early elections resulting in losses for his coalition.
The Popular Front is struggling to unify around a prime ministerial candidate, with factions ranging from moderates to radicals. Macron seeks a candidate with broad appeal who can withstand no-confidence motions. Despite the majority, the left lacks numbers to fully implement policies like raising the minimum wage.
Investors face challenges amidst political instability, impacting pro-market reforms and policy implementation. The looming budget vote in September could create further strain, posing risks for the market in the near future.