The exit polls for the second-round of France’s legislative election are certainly a surprise. The left-wing New Popular Front (NFP) appears to have become the biggest group in parliament, while National Rally (RN) has massively underperformed expectations, coming in third. Emmanuel Macron’s Ensemble is likely to have come second. On balance, with all three groups a long way from a majority, investors may well judge that the results have avoided the worst possible outcomes. But there is a risk that the hard-left Jean-Luc Mélenchon is appointed prime minister. And even if he isn’t, parliamentary gridlock will hinder efforts to get the public finances on a sustainable footing.
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