This was playing out against a backdrop of destabilizing events<br />that once seemed impossible — the election of Donald J. Trump in the United States and the vote to abandon the European Union in Britain, also known as “Brexit.”<br />Le Pen had moderated her positions in recent weeks as her election has gained plausibility,<br />her hostility for the European Union and the euro are well known.<br />The manic swings of the markets — first spooked by the possibility of a Le Pen presidency, then ecstatic over the apparent unraveling of<br />that possibility — attest to the gnawing fear that the euro could still succumb to whatever blow history delivers next.<br />Her strength in polls in recent weeks prompted investors to demand greater returns on French government debt, a sign<br />that the odds of default — however minute — were multiplying.<br />A Le Pen presidency could spook them into unloading some of it, increasing borrowing costs for the French government and the business world.<br />The French Parliament and Constitution would severely constrain a President Le Pen.<br />But the threatened act of redenominating French debt would almost certainly lead to a downgrade of France’s credit rating, bringing severe<br />market consequences, said Mujtaba Rahman, managing director for Europe at the Eurasia Group, a risk consultancy based in London.
