Quintuple Dutch?

In the UK, there has been only one coalition government in the past 50 years, with two-party politics dominating. In the Netherlands, the political landscape is very different. In order to form a government following today’s vote, it is likely that five different parties will need to join forces. Furthermore, and despite being favourite to win most seats, it appears that Geert Wilder’s PVV will not be one of these, with most other parties having ruled out a partnership. Therefore, the result may well be benign, with Nexit remaining very unlikely. This is a perspective supported by bond pricing, with greater yield spreads developing for French bonds (0.65% over 10-year bund; compared with Netherlands: 0.10%), highlighting investors’ greater wariness of the French election results.