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Europe votes! Well, a few people did

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  • The European election results produced the expected rise in anti-establishment, anti-Europe and extremist parties, with the results generally coming out as opinion polls had been suggesting. There are two ways this has an influence.
  • First, national politics might be impacted. The UK and France are the obvious areas of focus here, but the Danish Peoples' Party topped their poll and AfD Germany polled 7% of their electorate.
  • Second, there is a risk to the image of Europe - if the election results are presented as an elite out of touch with the voters. The turnout was low (as always) and pro-Europe parties took a majority of the seats, but in such things spin not substance tend to matter.
  • ECB president Draghi is scheduled to speak. He should not comment directly on the election results but there are indirect impacts for policy. If the Euro weakens further, then the (very faint) risk of deflation becomes ever more remote, and inflation perceptions may rise.

Listen to the audio version of this briefing.