AUD: AUDNZD highest since October 2022

FX Exchange traded rolls should pick up this week, expiry next Monday:

• EUR: 10%.
• GBP: 12%.
• CHF: 10%.
• CAD: 11%.
• JPY: 12%.
• AUD: 12%.
• NZD: 11%.

French President Emmanuel Macron's decision to dissolve the National Assembly and call snap legislative elections following the poor performance from his centrist Renaissance-led alliance in the European Parliament election is a significant gamble. In the EP election, Renaissance and its allies came in a distant second with 14.6% support, well behind the right-wing nationalist Rassembelement National (National Rally, RN) of Marine Le Pen on 31.5%. Even prior to the calling of the snap vote, Macron's group did not hold a majority in the National Assembly, with PM Gabriel Attal reliant on the backing of other parties to pass legislation. 

• For Macron, the hope will be that the two-round system used in French elections (first round 30 June, second 7 July) blunts the increased support for RN, with voters from across the political spectrum banding together to back the non-RN candidate should they make it through to the second round. 
• At present the most likely outcome is for RN to increase its seat total, but fall short of an overall majority. RN President Jordan Bardella has said that he would serve as Macron's PM, and the prospect of RN becoming the largest party cannot be ruled out. 
• 'Cohabitation' (PM and president from different parties) is rare in France, and often hampers policy making and enactment. 
• The election will be closely watched in Brussels, with the risk of an increased role for RN in French national politics a major cause for concern given the party's anti-EU, anti-NATO, anti-Ukraine funding stances. 

• ITALY APR INDUSTRIAL PRODUCTION -1.0% M/M ; -2.9% WDA Y/Y