Reuters - cctober 6, 2025. REUTERS/Stephane Mahe/Pool LIVE Last updated 5 mins ago - Live: France’s new Prime Minister Sebastien Lecornu resigns, sparking fresh political chaos

 Reuters 

cctober 6, 2025. REUTERS/Stephane Mahe/Pool

LIVE

Last updated 5 mins ago

Live: France’s new Prime Minister Sebastien Lecornu resigns, sparking fresh political chaos

By Kylie MacLellan, Christina Anagnostopoulos, Karishma Singh and Andrew Heavens

What's happening?

French Prime Minister Sebastien Lecornu and his government resigned

It came hours after he appointed his cabinet

French stocks and the euro dropped sharply

He was President Emmanuel Macron's fifth PM in two years

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Video

Just joining us? Here is what has happened so far

10 minutes ago

14:08 +03

Ciara Lee

Reaction

Ultra-long bond yields rise and France spread widens

20 minutes ago

13:58 +03

Stefano Rebaudo

Short-dated euro area borrowing costs fell, and the yield spread between French government bonds (known as OATs) and safe-haven Bunds widened on Monday after Lecornu resigned.

Markets are watching closely to see whether the next step in France will be a snap election, with the far-right Rassemblement National likely to play a leading role in the next government.

Meanwhile, ultra-long government bond yields pared earlier gains after rising at the start of the session.

Germany's 10-year Bund yields, the bloc's benchmark, rose 2 basis points to 2.72%.

Traders slightly increased their bets on future European Central Bank rate cuts. They priced in an about 40% chance of a 25 basis point ECB rate cut by July from 35% before Lecornu's resignations.

The yield gap between safe-haven Bunds and 10-year French government bonds — a market gauge of the risk premium investors demand to hold French debt — hit 87.96 basis points, the highest level since January 13, on concerns about the French fiscal outlook.

"The French-German yield spread is likely to widen further even if President Emmanuel Macron appoints a new prime minister, who would still face the same political gridlock that challenged Lecornu," said Massimiliano Maxia, senior rate strategist at Allianz Global Investors.

Reaction

Berlin: French crisis does not impede Europe's capability to act

43 minutes ago

13:36 +03

Friederike Heine

Lecornu's resignation does not impede Europe and Germany's capability to act, a German government spokesperson said.

"A stable France is also an important contribution to stability in Europe," the spokesperson said. "But I have no reason to doubt that there is stability in France too."

On Monday's podcast...

an hour ago

13:29 +03

Kim Vinnell

We discuss French politics, the Gaza talks, Everest and vaccines. Follow on Apple or Spotify. Listen on the Reuters app.

If you're on Spotify, you can watch the episode as a brand-new video podcast.

Analysis

The succession question

an hour ago

13:11 +03

Gabriel Stargardter

The succession question

FILE PHOTO: Macron at the Arc de Triomphe in Paris, July 14, 2025. REUTERS/Abdul Saboor/Pool

There is another key factor contributing to France's political instability - the race to succeed Macron.

He cannot run again in 2027, and all political parties have been trying to stake out their ideological ground ahead of the vote. 

That has made it nearly impossible to find common ground in parliament, leaving Macron's prime ministers at the mercy of truculent lawmakers in no mood to compromise. 

Little surprise, then, that Macron has already cycled through five prime ministers since 2022.

Analysis

What happens next?

an hour ago

12:51 +03

Gabriel Stargardter

What happens next?

FILE PHOTO: Macron at the U.N. General Assembly, New York, September 23, 2025. REUTERS/Eduardo Munoz

After accepting Lecornu's resignation, Macron now faces three unpleasant options:

1) NAME A NEW PRIME MINISTER

A figure from within his own camp appears unlikely, and Macron has been unwilling to name a leftist, as they want to dilute his hard-won pension reform. A left-leaning figure would also irritate France's right-wingers, who want more emphasis on law and order, immigration and austerity.

2) CALL AN ELECTION

He could dissolve parliament and call fresh legislative elections, a move he has said he is unwilling to do and which could potentially lead to a far-right National Rally (RN) government if it were to win a majority.

3) QUIT

His final option - and one he has repeatedly rejected - is to resign. It's unclear who might win a presidential vote, but polls suggest the RN stands a good chance of victory.

Focus on France's credit rating

2 hours ago

12:42 +03

Marc Jones

The resignation will keep the focus on France's credit rating.

Fitch cut it below the AA threshold for the first time ever last month, but credit default swap markets - the place investors go to hedge their exposure to French government bonds - point to at least one more downgrade.

That also stands in contrast to upgrades being priced in for Italy and Spain, but also Britain where the government's popularity is also struggling.

2 hours ago

12:39 +03

Reaction

Snap parliamentary elections 'worst case'

2 hours ago

12:34 +03

Dhara Ranasinghe

LEE HARDMAN, SENIOR CURRENCY ANALYST, MUFG, LONDON:

"The fall in the euro shows markets are becoming more uneasy about the political uncertainty in France. The pressure now goes back to President Macron to see how he deals with this deadlock.

For the market, the worst case would be if he tries to break that deadlock by calling snap parliamentary elections, that would extend the uncertainty in the near term and likely trigger another leg lower for the euro.

The risk of that has increased after Lecornu's resignation."

KIRSTINE KUNDBY-NIELSEN, ANALYST, DANSKE BANK, COPENHAGEN:

“There seems to be no willingness in parliament for a budget to be passed, so I think yields higher, pressure on euro-dollar in the near term.

"There doesn’t seem to be a willingness to get lower government deficits and consolidate French public finances and investors want a premium for that."

How did we get here?

2 hours ago

12:23 +03

Ingrid Melander

How did we get here?

FILE PHOTO: Protesters demonstrate in Nantes against the government and possible austerity cuts, October 2, 2025. REUTERS/Stephane Mahe

France's politics have become increasingly fraught since Macron bet big by calling a snap parliamentary election in 2024 which resulted in a deeply fragmented parliament. 

His control over parliament weakened as France's debt ballooned, in part due to his largesse during the COVID and cost-of-living crises. 

Budget talks became increasingly fraught, requiring delicate trade-offs between three ideologically opposed blocs - Macron's ruling centrist minority, the far right and the left.

Adding to the pressure, thousands marched through cities last week to protest plans for sharp spending cuts.

Lecornu's pick for finance minister Roland Lescure, 58, would have faced a tough balancing act: securing either support or abstention from the Socialists, while preserving Macron's pro-business legacy and keeping conservatives and liberals on board.

To win over the Socialists, Lecornu had proposed a wealth tax long demanded by the left, and ruled out using special powers to push the budget through parliament without a vote. The Socialists had called his overtures insufficient.

Lecornu's two predecessors, Francois Bayrou and Michel Barnier, were brought down by parliament over efforts to rein in public spending at a time when ratings agencies and investors are watching closely

'I was ready to compromise', says Lecornu

2 hours ago

12:14 +03

Benoit Van Overstraeten and Inti Landauro

'I was ready to compromise', says Lecornu

Lecornu at the Hotel Matignon in Paris, October 6, 2025. REUTERS/Stephane Mahe/Pool

Lecornu has just delivered a short speech in the courtyard of Matignon Palace, the Prime Minister's headquarters.

He blamed political parties' intransigence for his resignation.

"I was ready to compromise, but each political party wanted the other political party to adopt its entire program," he said.

"There are a lot of red lines being expressed by some others. There are few green lines."

"We must find a way out so the country can move forward," he said. "When it comes down to it ... It wouldn't take much for it to work."

Reaction

'Macron must go'

2 hours ago

12:09 +03

Ingrid Melander and Michel Rose

'Macron must go'

FILE PHOTO: Panotin in Paris, France, September 9, 2025. REUTERS/Abdul Saboor

Earlier we reported far-right National Rally leader Jordan Bardella had called for fresh elections.

The hard left France Unbowed said Macron himself must go.

The group's president in the National Assembly, Mathilde Panot said: "Lecornu resigns. 3 Prime Ministers defeated in less than a year. The countdown has begun. Macron must go."

Reaction

'Hard to understand what was in Macron/Lecornu's minds'

2 hours ago

12:02 +03

Bart Meijer

Former IMF Chief Economist Olivier Blanchard said it is striking "the degree to which the discussion is about people, and not about issues."

'Hard to understand what was in Macron/Lecornu's minds' 

Source: @ojblanchard1

How long was Lecornu prime minister?

2 hours ago

12:00 +03

Ingrid Melander

How long was Lecornu prime minister?

Outgoing Lecornu arrives to deliver a statement at Hotel Matignon in Paris, October 6, 2025. REUTERS/Stephane Mahe

Lecornu's government was the shortest-lived in modern French history.

He was prime minister for only 27 days. His government lasted 14 hours.

Reaction

'It's just one government after another'

2 hours ago

11:50 +03

Dhara Ranasinghe

PHILIP SHAW, CHIEF ECONOMIST, INVESTEC, LONDON:

"The impasse is likely to going to continue. There is already a certain degree of uncertainty priced in. One question is, does this mean we are heading to fresh elections, but at this point it hard to tell what Macron will do."

"We have been here before, but elections did not solve (it)."

CHRIS BEAUCHAMP, CHIEF MARKET ANALYST, IG GROUP, LONDON:

"It's just one government after another and we're looking at the run of finance ministers ... this is the major problem for French assets but it has spillover effects for the rest of Europe.

"It certainly makes people wary about European assets at this point because of the uncertainty and the spillover effects that go from France just being unable to find its way out of this malaise."

MICHAEL BROWN, SENIOR RESEARCH STRATEGIST, PEPPERSTONE, LONDON:

"The thing that is really playing on market participants' minds is not really the fact that the PM has quit - which has clearly come as a bit of surprise, though his future was looking ropey this week anyway, I think the bigger question (is) how does this all resolve itself? Because there doesn’t seem to be an obvious solution, or obvious silver bullet that we can look to, to resolve it overnight."

What to know about Lecornu

3 hours ago

11:45 +03

Michel Rose

What to know about Lecornu

Lecornu at Hotel Matignon in Paris, on October 3, 2025,Alain Jocard/Pool via REUTERS

Lecornu, 39, was Macron's fifth prime minister in less than two years.

Here are some key facts about him:

He is a Macron loyalist - a one-time conservative protege who rallied behind Macron's 2017 presidential run.

He most recently served as defence minister, overseeing an increase in defence spending.

Lecornu entered politics canvassing for former President Nicolas Sarkozy when he was 16.

He became mayor of a small town in Normandy when he turned 18 and then Sarkozy's youngest government adviser at the age of 22.

He left the conservative Les Republicains party to join Macron's centrist political movement in 2017.

Five years later, he ran Macron's re-election campaign.

'Ready to take on the responsibilities', says Socialist lawmaker

3 hours ago

11:40 +03

Benoit Van Overstraeten

Socialist Philippe Brun said on X: "We are ready to take on the responsibilities of the country. It is time to call on those who came out on top in the elections."

'Ready to take on the responsibilities', says Socialist lawmaker

Source: @p_brun on X

Deep political crisis

3 hours ago

11:37 +03

Richard Lough

Deep political crisis 

FILE PHOTO: Macron at the Elysee Palace in Paris, August 27, 2025. REUTERS/Abdul Saboor 

France has rarely suffered a political crisis so deep since the creation in 1958 of the Fifth Republic, the current system of government.

The 1958 constitution was designed to ensure stable governance by creating a powerful and highly centralised president endowed with a strong majority in parliament, and to avoid the instability of the periods immediately before and after World War Two.

Instead, Macron - who in his ascent to power in 2017 reshaped the political landscape - has found himself struggling with a fragmented parliament where the centre no longer holds the balance and the far-right and hard-left hold sway.

France is not used to building coalitions and finding consensus.

Reaction

National Rally calls for a snap election

3 hours ago

11:30 +03

The far-right National Rally immediately urged Macron to call a snap parliamentary election.

"There can be no return to stability without a return to the polls and the dissolution of the National Assembly," National Rally leader Jordan Bardella said.

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Kylie MacLellan

Thomson Reuters

Kylie is the Global Live Pages Editor, leading a team providing real-time multimedia coverage of the biggest breaking stories worldwide. She previously worked on the UK Breaking News team, and spent eight years in Westminster as a UK political correspondent - a period which included the Scottish independence referendum, Brexit and several general elections. She originally joined Reuters as a graduate trainee and has also covered investment banking.

Karishma Singh

Thomson Reuters

Has worked in a variety of roles across the Reuters newsroom, including as a pictures and text editor, and as a general manager overseeing operations across Asia. Based in Singapore.