A first-round parliamentary election result promising President Emmanuel Macron a crushing majority in parliament lifted investor sentiment on Monday though the lowest voter turnout in modern history clouded celebration.
Pollsters said Macron was on course to win as much as three quarters of National Assembly seats in the June 18 second round after 28 per cent of those who voted in Sunday's first round chose his Republic on the Move (LREM) party.
That would be France's biggest majority in decades, and effectively leaves only the powerful trade union movement as a potential obstacle to the pro-business reforms ex-banker Macron has promised to introduce in a bid to boost growth and jobs.
|FILE PHOTO: French President Emmanuel Macron attends a meeting at the Elysee Palace in Paris, France, May 23, 2017. REUTERS/Philippe Wojazer/File Photo 1/5leftright 2/5leftright 3/5leftright 4/5leftright 5/5leftright 1/5
French borrowing costs fell on Monday, tightening the gap over benchmark Germany.
France's 10-year government bond yield fell 3 basis points to 0.62 percent, outperforming other higher-rated euro zone peers. The gap over benchmark German Bund yields tightened to around 36 basis points from around 39 bps late on Friday.
But fewer than half of the 47 million voters turned out in the first round - the lowest level by far in a legislative election in the 60-year-old fifth Republic.
Macron was a political unknown three years ago and is heading a start-up party, but as the scale of his likely victory emerged on Sunday, his opponents saw a danger to democracy.
Just a month after the 39-year-old won a bitter and drawn-out battle for the presidency, some questioned whether he had a mandate to pursue a pro-business reform agenda.
The spokesman for Macron's government recognized the challenge that lies ahead.
"We have to restore trust," said Christophe Castaner, who is also minister for parliamentary relations, on Monday.
"It is the government's responsibility, that of the president, that of the prime minister, to restore trust in the election process," he told France 2 Television
"We don't want a majority to have an easy time of it. We want a majority that will reform," he added.