EZA 828 Report

30 January 2008

Germany Politics

State elections in Lower-Saxony, Hesse – left shift in German politics

Lower Saxony and Hesse state elections on balance imply a shift to the left in German politics, given the success of the (far) Left party in entering both state parliaments.
For the other parties the message is less clear: in Hesse the SPD clearly scored against the CDU, while the CDU prevailed by a wide margin in Lower Saxony.
The election outcome implies increased pressure for left wing policies such as higher social spending, and extending minimum wages. Potentially challenging earlier economic reform achievements.


Asset conclusions: competition for populist policies likely drag factor for German capital markets and the euro.

© Graham Bishop