Lecornu Resigns; Le Maire Quits, Markets Slide

French Prime Minister Sébastien Lecornu resigned Monday after less than a month in office and only hours after unveiling a new cabinet; President Emmanuel Macron accepted the resignation and the ministers named were left as caretakers. The collapse followed the withdrawal of a key conservative ally over ministerial choices and prompted former finance minister Bruno Le Maire to quit after being named defence minister. The fall deepens an impasse stemming from last year’s snap elections and a hung parliament and marked the third government collapse in under a year, leaving Macron to either name another premier or call early legislative elections. Markets reacted sharply: French stocks plunged, the premium on French debt over German peers jumped to multi-month highs, U.S. Treasury yields rose and the euro weakened on contagion fears. Observers warn the instability threatens France’s ability to pass a budget, accelerates political polarization and could boost support for the far-right National Rally ahead of 2027 contests.