Evening Briefing: Europe

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Newly reappointed French Prime Minister Sebastien Lecornu offered to suspend a law to raise the retirement age, sacrificing one of President Emmanuel Macron’s key economic measures in a bid for political stability.

In a 30-minute speech in Paris today (which we live blogged), Lecornu implored lawmakers to avoid a fiscal crisis and pledged to work with parliament to forge a budget agreement. “It’s urgent to bring meaning back to politics,” he said.

Marine Le Pen’s far-right National Rally and the far left have vowed to try to topple the premier in no-confidence votes on Thursday.

But the decision of The Socialist Party, which holds a crucial role in the National Assembly, is key. And they’ve said they’d only back the government if the pension law was suspended.

As the chance of snap elections appeared to diminish, French-focused stocks gained. Bond gains picked up. — Caroline Alexander

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Credit Suisse bondholders got hope they may eventually be awarded damages after their investments were wiped out when UBS rescued the bank in a government-brokered deal. The complainants, some 3,000 investors, had argued the March 2023 decree to write down 16.5 billion Swiss francs ($20.5 billion) of the additional-tier 1 bonds was unlawful and should be revoked, and the write-down be reversed. The Swiss Federal Administrative Court said today it ruled one of those as a test case, siding with the complainants’ right to appeal and revoking the decree.

The European Union is considering forcing Chinese firms to hand over technology to European companies if they want to operate locally, in a push to make the bloc’s industry more competitive. The measures would apply to companies seeking access to key digital and manufacturing markets, we’re told. The rules would require them to use a set amount of EU goods or labor, and to add value to the products on EU soil. Enforcing joint ventures is another option on the table.

Boeing and Airbus are suffering “unprecedented” delays in certifying and delivering aircraft, stifling airlines’ growth and plans to decarbonize, customers say. The holdups are causing backlogs at major European carriers, according to Air France-KLM Chief Executive Officer Ben Smith. Every supplier is behind schedule, and airlines have seen no improvements since the pandemic ended.

Chancellor of the Exchequer Rachel Reeves laid the ground for a tough UK budget next month, telling cabinet colleagues that high borrowing costs and debt levels meant there would be less money for public services. After hitting mainly businesses with £40 billion ($53 billion) of tax increases in last year’s budget, economists expect the chancellor to come back for more on Nov. 26, despite promising not to do so.

Advanced Micro Devices, Nvidia’s nearest rival in AI processors, said that Oracle will deploy a large batch (50,000) of its forthcoming MI450 chips next year and that the systems will contain AMD processors and networking components. The announcement is the latest in a frenzy of commitments by big tech and companies to build more computing infrastructure to meet demand for AI services they say is skyrocketing. It’s also another endorsement of AMD technology.

A political stalemate over Slovakia’s central bank governor, Peter Kazimir, may enable him to keep his job until the next parliamentary election in 2027 — even though he’s been convicted of bribery. Kazimir’s term expired on June 1. But Prime Minister Robert Fico’s alliance is split over whether the governor, who is appealing his conviction after being fined €200,000 ($231,520) by a Slovak court in May, should be re-appointed for another term or not. Kazimir also sits on the European Central Bank’s Governing Council.

A faction of Madagascar’s army said it’s taken control of the country after lawmakers voted to impeach President Andry Rajoelina, who had sought to head off the ballot dissolving parliament. Demonstrations erupted in Madagascar last month over water and power shortages, sending thousands of people into the streets and leading to clashes with security forces in which at least 22 people died.