Goldman Sachs on France: Le Pen Remains Favourite as National Rally Sets Out Fiscal Plans

Polling models continue to show Marine Le Pen as the favourite for next year’s presidential election, with Rassemblement National also seen as likely to secure a parliamentary majority. That has increased focus on the party’s fiscal proposals, including a “counter-budget” that would improve the primary balance from -2.6% to -0.6% of GDP next year. Such a large adjustment would likely be difficult to implement given the election timetable and potential drag on growth, but it may indicate the concessions the party would seek in any budget compromise. Over the medium term, Rassemblement National projects a primary surplus of 1.2% of GDP and a declining debt ratio by 2032. That is broadly consistent with assumptions that France will eventually need a primary surplus above 1% of GDP to stabilise and reduce debt. However, some of the party’s growth assumptions appear optimistic, particularly the expectation that growth accelerates to 1.8% between 2028 and 2030 while the fiscal balance improves sharply over the same period.