Emmanuel Macron’s EU army dream on path to approval if Joe Biden wins US election

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Speaking to Express.co.uk, Professor of National Security and Political Science at the University of New Haven Matthew Schmidt said Democratic candidate Joe Biden will be “wholeheartedly embraced” by European leaders across the Brussels bloc. Professor Schmidt argued anyone different from incumbent President Trump would have looked better in the eyes of EU leaders as they look to reinstate their powerful “before-Trump” status across the world. 

But the American expert admitted that regardless of who wins this month’s crucial election in the US, the United States will remain an unchallenged military power. 

Asked if he believed that a Biden victory could speed up French President Emmanuel Macron’s dream of setting up an EU army to replace NATO, he replied: “Yes and there’s a rationale for having that.

“And generally people have spoken to that in terms of a European rapid reaction force, which is something significantly less than an army.

“It’s something like a much smaller Marine Corps in the US sense of things that would be quickly deployed to hotspots, but it wouldn’t be large enough or capable enough to maintain the fight very long, more than a few weeks, say, without having to call in NATO troops or Americans as allies.

“And so to that effect, I think that that’s important for the EU to have, and I don’t think it particularly weakens NATO.

“In fact, a rapid reaction force could be easily integrated as a unit into NATO, because remember we don’t have NATO troops.

“We have different countries that contribute troops to NATO and so why couldn’t the EU act in that way and contribute as a rapid reaction force to NATO, but still have independent control over it and be able to send it to places that the EU decides to send to for security reasons, that NATO wouldn’t go to.”

Euro zone bond yields rose on Tuesday with markets increasingly confident challenger Joe Biden would win the US presidential election, although trading was quiet as investors refrained from taking on new large positions before the outcome.

The rise in yields also followed Monday’s drop as investors rushed for safer assets in the wake of new lockdown restrictions imposed by governments across Europe to fight the spread of COVID-19.

Market participants expect a volatile day on Wednesday when the results of the United States presidential election become clear. But on Tuesday stock markets rose as investors sold out of safer bonds and bet on a clear win for Biden, the Democratic Party candidate.

President Donald Trump and Biden made a last-ditch push for votes in battleground states on Monday as their campaigns prepared for post-election legal disputes that could delay a clear outcome.

The benchmark German 10-year yield was last up 3 basis points at -0.609 percent, while other core euro zone bond yields rose more modestly.

“There is an expectation that there will be a Biden victory,” said Jan von Gerich, an analyst at Nordea. But he said that there was a “preparedness that there could be some big moves” on Wednesday should the result be unclear.

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He said he doubted the US election outcome would have much impact on euro zone bond yields, given the European Central Bank “remains in control and will keep yields near these levels”.

The ECB’s vast bond-buying scheme, designed to calm markets and stoke an economic recovery, has crushed fixed income volatility.

UniCredit analysts said that if Democrat challenger Joe Biden, wins, the spread between US 2- and 10-year bond yields could widen to a new multi-month high above 70 basis points and the difference between 10-year US and German bond yields move towards 155 basis points, its biggest since March.

“The main aspect of a blue wave is a higher growth and inflation outlook compared to the current status quo, in our view, with global economic policy uncertainty declining,” they said.

Peripheral yields also increased marginally, with the Spanish 10-year bond yield up 1 basis point to 0.133 percent . Italian 10-year yields gave up early gains and were down 1 basis point at 0.71 percent.

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