French lawmakers will debate and vote on motions of no confidence against Michel Barnier's fragile government on Wednesday.
The motions, submitted by the opposition Left Bloc and the far-right National Rally party, will likely be debated around 4 p.m., the National Assembly said in a social media post.
The government may have to resign if either measure is approved by Parliament.
This got here after French Prime Minister Barnier selected Monday to push through a controversial budget bill without parliamentary approval, using special constitutional powers.
It is widely expected that the left and right can form an alliance to topple the present center-right government.
“Barnier is at the mercy of Marine Le Pen’s right-wing Rassemblement National [National Rally]. “Together with the united left, she could topple Barnier in a vote of no confidence,” Berenberg chief economist Holger Schmieding warned in an announcement last week.
Attempts to achieve a compromise on a draft budget that features 60 billion euros ($63.16 billion) in tax hikes and spending cuts to scale back France's deficit stalled over the weekend.
It is unclear what is going to occur next if the federal government is overthrown. New parliamentary elections cannot happen until next June, 12 months after the last early vote called by French President Emmanuel Macron this 12 months.
Macron must also appoint a brand new prime minister – a politically explosive task given the fragmentation of the present parliament.
France's CAC 40 index rose 0.57% after confirmation of the vote on Wednesday, while the euro gained 0.3% against the US dollar. French bond yields barely modified.
Still, economists say the specter of political instability could spell bad news for French assets, with uncertainty already pushing French borrowing costs to a 12-year high, above Germany's and on par with Greece's.
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