NETHERLANDS: Moderates Gain In Election As Parties Of Fmr. Gov't Lose Out (1/2)
The main 'winners' from the 29 October general elections were parties from the centre of the political spectrum, with the liberal pro-EU Democrats 66 (D66) and centre-right Christian Democratic Appeal (CDA) each making significant gains. The D66 saw a late surge in polling support, with Rob Jetten's party looking set to have won 26 seats in the 150-member House of Representatives, up from nine in 2023. The CDA, which at one point was leading nationwide polls, had to settle for 18 seats, up from five.
- With 99.7% of votes counted, Geert Wilders' far-right populist Party for Freedom (PVV) is neck-and-neck with D66 in terms of overall vote share and is set to win 26 seats (down from 37 in 2023). It would appear voters laid the failures of the Schoof gov't largely at the feet of the PVV (and the centrist New Social Contract, which lost all 20 of its seats). For Wilders, this will mean a return to the position of main opposition, attempting to steer public debate on issues of immigration and culture but without direct policy influence.
- The election has claimed the position of one major party leader, with centre-left/environmentalist GreenLeft-Labour (GL-PvdA) leader Frans Timmermans announcing his resignation after the party saw its seat total fall from 25 to 20.
- The 'easiest' route to a coalition gov't would be a broad centrist bloc containing D66, CDA, GL-PvdA, and the liberal conservative People's Party for Freedom and Democracy (VVD, 22 seats), encompassing 86 seats and comfortably crossing the 76-seat majority threshold. Jetten would be the frontrunner to become the Netherlands' youngest-ever PM as leader of the largest party and a centrist compromise for the GL-PvdA and VVD.
Chart 1. General Election Results, 2023 (LHS) and 2025 (RHS)
Source: NOS, Kiesraad, MNI. N.b. 2025 results based on 99.7% of votes counted.
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US TSY FUTURES: Mix Of Short Cover & Long Setting Seen On Monday
OI data points to a mix of net short cover (TU, FV & TY) and long setting (UXY, US & WN) as Tsy futures rallied on Monday.
- The curve-wide bias was tilted towards net long setting (in DV01 terms), owing to the ~$4.2mln DV01 equivalent of net long setting in WN futures.
| 29-Sep-25 | 26-Sep-25 | Daily OI Change | OI DV01 Equivalent Change ($) |
TU | 4,545,907 | 4,558,432 | -12,525 | -424,890 |
FV | 6,684,536 | 6,729,775 | -45,239 | -1,985,770 |
TY | 5,435,162 | 5,452,089 | -16,927 | -1,104,028 |
UXY | 2,429,790 | 2,413,949 | +15,841 | +1,386,896 |
US | 1,818,387 | 1,805,689 | +12,698 | +1,802,161 |
WN | 2,026,338 | 2,004,016 | +22,322 | +4,178,293 |
|
| Total | -23,830 | +3,852,663 |
EGB FUNDING UPDATE: Spain cuts net debt issuance target from E60bln to E55bln
- Earlier this morning, Tesoro Publico announced that it was cutting its 2025 net issuance target by E5bln to E55bln due to "strong economic growth" in particular a strong labour market "with record numbers of taxpayers, which has resulted in lower financing needs."
- The Treasury notes that the stronger finances are in spite of the costs of Storm Dana and increased defence spending.
- 2025's net issuance target is now the same as 2024's.
