Macron Unveils New French Cabinet, Rejects Resignation Calls Amid Political Crisis

Macron Unveils New French Cabinet, Rejects Resignation Calls Amid Political Crisis

TYLER DURDEN

President Emmanuel Macron unveiled a new cabinet on Sunday after reappointing Sébastien Lecornu as prime minister, an urgent maneuver to stabilize what has become one of France's worst political crises in decades. As one UBS analyst quipped to clients earlier on Monday, "No one had Lecornu 2.0 on their bingo cards." Also, Macron dismissed mounting calls for his resignation amid a plunge in sentiment polls, as the embattled globalist president has burned through five prime ministers in less than two years. 

Lecornu, who resigned at the start of last week before being reinstated Friday, faces the daunting task of holding Macron's weakened centrist alliance together as parliament remains deeply divided. The new cabinet will meet on Tuesday, when Lecornu is expected to present a new budget proposal.

Macron also reappointed key ministers, including Roland Lescure (Finance), Amélie de Montchalin (Budget), and Jean-Noël Barrot (Foreign Affairs). Laurent Nuñez replaced Bruno Retailleau as Interior Minister after Retailleau's Republicans withdrew support for the government.

Here's commentary on the ongoing political storm in France from UBS analyst Simon Penn:

Sébastien Lecornu is back as French Prime Minister. After four days away, he was reappointed by President Macron late on Friday night to have another go. It's unlikely anyone had that among their expected outcomes. Following his reappointment, Lecornu said his priority was to get back to trying to repair the French public finances. Lecornu is now expected to name a new cabinet soon. He also needs to propose a new budget on Monday, if legislation is to be adopted by year-end. Lecornu said he had accepted President Macron's offer "out of duty". Over the weekend, he has been trying to rebuild the cabinet, one in which all concerned will stay.

Late Sunday, Lecornu wrote on X, "A mission government is appointed to provide a budget for France before the end of the year." 

However, Marine Le Pen's National Rally and the far-left have already pledged to back no-confidence votes this week, meaning Lecornu must rely on abstentions from the Socialists and Republicans to survive. 

The Socialist Party has demanded that Macron suspend pension reform that raised the retirement age, new taxes on the wealthy, and loosen fiscal rules for more deficit spending. Macron's centrist and center-right allies oppose such moves but remain divided over whether to back Lecornu's government.

Earlier today, Macron arrived in Egypt to attend a gathering of world leaders aimed at ending the war in Gaza. He remained defiant and blamed political rivals for destabilizing France and said he had no plans to resign before his second and final term ends in 2027.

"I ensure continuity and stability, and I will continue to do so," Macron told reporters, urging people not to forget that the mandate given to the president means "to serve, to serve, and to serve."

Despite the worst political turmoil in decades, French bonds and equities were flat on Monday, with CAC 40 futures tracking broader European gains. 

UBS analyst Nicola Brion told clients, "France's President Macron reappointed Lecornu as PM and presented the new cabinet. The CAC is up 60bp, mostly led by luxury while French banks trade broadly flat."