French presidential elections scenarios

French voters will go to the polls on Sunday, April 23rd for the first round of their most unorthodox election in the living history. According to the majority of opinion polls, Emmanuel Macron will become a front-runner of this presidential race. But the gap separating him from other leading candidates such as Marine Le Pen, Francois Fillon, and Jean-Luc Melenchon is quite narrow.

Despite the comprehensive calculations of statisticians and great efforts made by pollsters, the outcome of this election is almost unpredictable. There are at least two factors that makes predicting the results of this election extremely difficult and precarious.

The first one is turnout which was about 80% for presidential election. This time, the following number might decrease drastically to as low as two-thirds which can potentially distort the most awaited and plausible result of the runoff – Le Pen - Macron in the second round.

The second factor – indecisiveness of the French electorate. Only 60% of voters say that they are sure of their choice. This figure is the highest among Le Pen’s supporters, the number of those who decided to back Macron oscillates at around 55%, the others are still dodging from giving a clear-cut answer. Well, this makes us believe that Macron’s win is a bit fragile, uncertainty-inducing one as there is a big chunk of undecided voters who might change their preferences as the voting day approaches.

The third factor – the French electorate is a hard nut to crack. They are unwilling to disclose their political preferences. They like discussing the possible scenarios of the election outcome. They readily give their opinions on the election agenda. They will be chanting the praises to one candidate and denouncing another, but they will never tell you who will be their favorite on the election day. Look at how they were springing electoral surprises before. They voted against the draft of the European constitution in 2005. They kicked out former president Nicolas Sarkozy and former prime ministers Alain Juppé and Manuel Valls in the presidential primaries. So, nobody knows which rabbit (far-right, EU-friendly, fraudulent center-right, or far-left) they pull out of the hat this time.

The pollsters suggested 5 possible scenarios for the second round

MACRON VS LE PEN – the most likely scenario

The two candidates were topping the polls for a few months. This scenario won’t spark a backlash in financial markets as they had plenty of time to get used to seeing Le Pen in the second round.  

FILLON VS LE PEN

This scenario was plausible until the sudden rise of Macron’s popularity. Now Fillon polls in third-fourth place because of a nepotism scandal involving his wife (“cherchez la femme”, blame la femme (woman) in your political failures). In this scenario, we would expect a huge abstention of left voter and high-risk of Le Pen’s win.

MACRON VS FILLON

It would be the most welcome outcome as both candidates are EU- and euro-friendly. The markets will be appeased with the thought that the threat of Frexit is eliminated.

MELENCHON VS LE PEN

This following scenario would be the biggest shock for financial markets, with two candidates despising the EU bureaucracy and craving to lead France out of the EU.

MACRON VS MELENCHON

The most erratic, as many traders would fear that Le Pen’s voters will shift towards Melenchon.