The unexpected right-wing victory in the Netherlands poses another significant risk to the European single currency

23 November 2023 137
The unexpected right-wing victory in the Netherlands poses another significant risk to the European single currency

Far-right lawmaker Geert Wilders won the Dutch elections and said he plans to lead the country’s next government, in a shock result that will resound across Europe.

 

In the final days of the election campaign, Wilders' anti-European party managed to beat his main rivals. Wilders’s Freedom Party won 37 seats, according to a preliminary count, more than doubling his representation from the previous parliament and giving him 12 more than his closest rival.

 

The frontrunner Dilan Yesilgoz-Zegerius conceded defeat.

 

Wilders’s victory presents a challenge to the European Union project in one of the bloc’s six founding members.

 

Wilders has promised voters a binding referendum on leaving the EU and railed against a range of the bloc’s policies on issues like climate change and immigration.

 

These statements will provide incentives for a sell-off in EURUSD.

 

“The hope of the Dutch people is that they will get their country back,” Wilders said after an exit poll published by state broadcaster NOS.

 

The growing number of refugees to the Netherlands, as well as rising food and energy prices, has boosted support for far-right groups across the European continent. Germany’s Alternative for Deutschland now has more support than any of the parties in Chancellor Olaf Scholz’s coalition.

 

Similarly, a center-right bloc led by Giorgia Meloni took power in Italy last year.

 

A comeback of right-wing parties' leadership in Europe, on the one hand, may give a boost to the economy in the long run, as it reduces the restrictive and regulatory functions of states and provides more economic freedom.

 

On the other hand, it jeopardizes further existence of the single European currency.

 

Recent elections in the Netherlands are another bellwether that is likely to trigger a short-term sell-off in the euro and a decline in EURUSD.

 

The Overall Recommendation is to sell EURUSD.

 

Profit or loss should be taken on Friday at the end of the American session.

This content is for informational purposes only and is not intended to be investing advice.

error
More
Comments
New Popular
Send
Commenting rules