FRANCE: PM Pushes Through Revenue Section Of Budget After Failed Censure Motions
Jan-23 11:52
After the (widely expected) failure of two censure motions, PM Sebastien Lecornu has formally pushed through the revenue section of the draft state budget without a vote. He then utilised Art. 49.3 again to bring forward the expenditure section, to be followed by the final draft of the budget, without a vote. This will allow the submission of further censure motions within 48 hours.
- The censure motion put forward by the far-left La France Insoumise (France Unbowed, LFI), the left-wing Democratic and Republican Left group (GDR), and the environmentalist Ecologists secured 269 votes, 19 short of the 288 needed for a majority. The motion submitted by the far-right Rassemblement National (RN) and Union for the Right of the Republic (UDR) won the backing of just 142 deputies.
- In the event, party discipline in the centre-left Socialist Party (PS) and conservative Les Républicains (LR) largely held. Party leaders had instructed their deputies not to back the motions. On the motion submitted by the leftists, only five of the 69 PS deputies and one of 49 LR lawmakers voted in favour. All deputies from the LFI, RN and UDR backed the motion, as did 36 of 38 Ecologists, 14 of 17 from the GDR, two of 22 from the Liberties, Independents, Overseas and Territories group, and two of the 10 non-affiliated lawmakers.
- A more sizeable PS and/or LR rebellion would be required to see the likely censure motions on the 2026 draft budget pass, meaning, for now, the Lecornu gov't looks set to be able to pass and enact the finance bill.
Chart 1. Vote On Censure Motion Submitted by LFI, GDR & Ecologists, Votes in Favour by Party
Source: Le Monde, MNI
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US OUTLOOK/OPINION: Weekly Claims Headline Today's Data – 0830ET
Dec-24 11:46
- Weekly jobless claims are released at 0830ET, a day early owing to the Christmas holiday, and should offer a clearer look at latest labor developments another week on from Thanksgiving distortions.
- Initial claims will be for the week to Dec 20 (expected to remain unchanged at a seasonally adjusted 224k) and include revisions to the Dec 13 week. The latter is a payrolls reference period, not that revisions tend to be large for initial claims and with them currently close to historically low levels (averaged 218k in 2019).
- The seasonally adjusted 224k currently shown for the December reference period compares with 222k for Nov, 231k for Oct, 232k for Sep and 234k for Aug.
- Continuing claims will provide a more useful update when it comes to reference periods, expected at a seasonally adjusted 1900k. If accurate, it would provide a favorable comparison after the 1944k in Nov, 1957k in Oct, 1916k in Sep and 1944k in Aug. Bear in mind that there is a longstanding pattern of downward revisions to the first release in the following week.
- Continuing claims have seen cycle highs in the 1960k’s throughout June, July, Aug and late Oct but haven’t broken above this (again, after revisions), implying a deterioration in hiring conditions ahead of the summer but one that has since stabilized.
US-EU: EU & French President 'Strongly Condemn' US Visa Bans
Dec-24 11:39
Following on from our previous bullet highlighting the latest strain on US-EU relations (US-EU: Visa Restrictions Risk Further Strain To Already Frayed US-EU Relations), the European Commission and French President Emmanuel Macron have now publicly condemned the US's actions in restricting visa access to French former European Commissioner Thierry Breton.
- In a statement, the Commission said it "strongly condemns" the visa restrictions, and that "We have requested clarifications from the U.S. authorities and remain engaged. If needed, we will respond swiftly and decisively to defend our regulatory autonomy against unjustified measures."
- Posting in English on X, Macron said France also condemns the actions, and "These measures amount to intimidation and coercion aimed at undermining European digital sovereignty."
- After two German citizens were also subjected to entry bans, Foreign Minister Johann Wadephul said the action was "not acceptable". The German foreign minister utilised the same language that EU and French officials have used in emphasising that the DSA was passed democratically and it does not have an extraterritorial effect.
- Earlier in the month, following EU fines levied against Elon Musk's X platform over violations of the DSA, senior administration officials, including US Vice President JD Vance, Secretary of State Marco Rubio, Federal Communications Commission chair Brendan Carr, and the US' ambassador to the EU Andrew Puzder, criticised the ruling as an attack on US firms, and an attempt to shut down free speech in the US.
LOOK AHEAD: Wednesday Data Calendar: Weekly Claims, 7Y Sale, Early Close
Dec-24 11:27
Early close today (1315ET) for Christmas eve, re-open for electronic trade Thursday evening for Friday's order of business:
- US Data/Speaker Calendar (prior, estimate). All times ET
- 12/24 0700 MBA Mortgage Applications (-3.8%, --)
- 12/24 0830 Initial Jobless Claims (224K, 224K)
- 12/24 0830 Continuing Claims (1.897m, 1.9m)
- 12/24 1000 US Tsy 4W & 8W bill auctions
- 12/24 1130 US Tsy $44B 7Y Note (91282CPQ8) & 17W bill auctions
- Source: Bloomberg Finance L.P. / MNI
