LONDON (MarketWatch) —The British are on the way out. The Dutch are about to flounce off in a huff, the French are about to elect a fiercely nationalistic president, while the Greeks and the Italians are just biding their time before the peripheral eurozone crisis blows up again, and brings the whole house of cards crashing down.

In the wake of both Brexit and Donald Trump, to many market pundits the European bond and equity markets were the next likely victims of a wave of populist uprisings.

But here is something nobody expected. Come the autumn, the eurozone may have its most pro-Europe, reformist leadership for a couple of decades. The centrist Emmanuel Macron is getting closer to power in France, while the Social Democrat leader Martin Schulz looks to have a decent chance of replacing Angela Merkel in Germany.

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A Schulz-Macron alliance could finally re-boot the euro, creating the momentum for the genuine fiscal, monetary and economic union that the single currency needs to become if it is to have a genuine chance of success. It might not work in the long-term. But in the short-term, it would give the European markets a real lift.

The script has 2017 marked down as a year of political upheaval across Europe. The Dutch were about to elect the Freedom Party’s Geert Wilders, while in France the National Front’s Marine Le Pen was running on a platform of bringing back the franc. In Italy, the populist Five-Star Movement was getting closer to power, and even in Germany the anti-euro Alternative for Deutschland was rising in the polls.

The markets are still fretting about that. The euro EURUSD, -0.03% has been sold off on political tension, dropping back down to 1.06 against the dollar, while the spread between French and Italian bonds, and the rock-solid German bund, a key measure of break-up risk, is starting to widen significantly.

Indeed, the yield on 10-year Italian debt TMBMKIT-10Y, 0.955% has more than doubled in the past year, and it is now back to 2015 levels. It is a long way below the 6% level it reached at the peak of the eurozone crisis — but it is heading back up again.

But that is not necessarily how it is going to play out. In fact, an alternative scenario is looking just as plausible —that Europe gets its most pro-European Union leadership in a couple of decades.

Start with France. With the Republican Francois Fillon sinking deeper into a scandal over vast sums paid to his wife from the state, the centrist Emmanuel Macron looks more and more likely to make it into the second round of voting in early May.

The basic rule of French politics is very simple. Whoever makes it into the second round again Le Pen wins the presidency: the National Front leader has huge support among her base, but 60% of the electorate would rather vote for lump of stale cheese.

Macron looks a surer bet with every week that passes.

Over in Germany, something just as dramatic is happening. Switching Martin Schulz from Brussels to Berlin has given the center-left Social Democrats a huge boost in the polls. One this week showed his party overtaking Angela Merkel’s Christian Democrats, while all of them have shown significant rises in support.

Add in the Left Party and the Greens, and come September Schulz may have enough support to finally bring Merkel’s long reign to an end. Indeed, as this column predicted at the start of the year, with her support draining away, Merkel may well decide to stand aside, and let someone else lead her party into the election.

If Schulz takes power, the Berlin-Paris axis, the most important relationship in European politics, would suddenly look very different. There would be the opportunity to accelerate economic integration — and give the euro a final chance to succeed. Far more than the leaders they would replace, both Macron and Schulz are passionate believers in the EU, and they are willing to sacrifice national sovereignty to make integration work.

Merkel was always portrayed as a great champion of the EU, and on paper she was.

But in practice, she didn’t do much about it. Greece was allowed to drift into limbo. Italy remained in the doldrums. France gradually became less and less competitive, while Germany racked up bigger and bigger trade surpluses. Moves towards a banking union were blocked. A fiscal union was dead in the water.

Merkel allowed the eurozone to become a zombie economy — she would do just enough to stop it dying, but nothing to make it come alive.

Between them, Macron and Schulz would agree on one thing. The eurozone, as Macron argued in a speech in Berlin last month, needs to radically change if it is to prosper. It needs to be turned into a fully functioning economic union.

What would that look like? For starters, there would be a banking union, with a single regulator, and a bailout mechanism. Next, sovereign debt markets would be pooled, and common eurozone bonds issued, backed by all the member states. There would be a EU Treasury, with powers to raise taxes, harmonize rates, and spend money right across the continent.

Over time, government offices would help redistribute wealth across the zone. Dutch tax returns would be processed in Portugal, and German cars would be certified in Sicily. In short, Brussels would look a lot more like the federal government in Washington.

True, that might create intense political opposition. Lots of people won’t like it. But between them Macron and Schulz as president and chancellor would have the will and momentum to make it happen.

They may be doomed to ultimate failure. In the short-term, however, it would lift confidence, and push the currency, bond and equity markets higher. There is a lot of political risk out there in Europe — but right now it might be on the upside, not the down.