A presidential election win for far-right anti-establishment candidate Marine Le Pen in France would cause turmoil in the country's corporate sector as firms brace for the prospect of an exit from the European Union, according to analysts from Citi.
"A Le Pen presidency with an (Front National) majority in the house would see a sharp increase in uncertainty, trigger a probable freeze in capex (capital expenditure) and hiring plans," political analysts at the bank, including Tina Fordham, said in a new note on Friday.
The bank says there's a 20 percent chance that Le Pen wins on May 7 and is not its base case scenario. However, the prediction is not too far away from similar predictions it gave President Donald Trump ahead of the U.S. elections. Citi did give Trump a 30 percent chance of winning before last November, but these figures fluctuated as the race tightened.
Citi predict that Le Pen could "re-ignite a fully-fledged sovereign debt crisis on fears of euro zone breakup" which would lead to a "substantially lower" GDP (gross domestic product) for France and and higher inflation would beckon.
"The euro losing one of its largest and founding member states would likely have more serious consequences than Brexit for the EU and the euro area economic activity in general," Citi said.
"There would be a real risk that re-igniting a fully-fledged sovereign debt crisis would ultimately spell the end for the euro as some of the core countries would likely refuse to back-stop the periphery. A likely disintegration of the EU would also have serious geopolitical ramifications," it added.