Germany finalizes an agreement on the ECB leadership with De Cos as favorite
According to the German and French press, France, Germany and Spain would share out the vacancies of the body
Special envoy to DublinThe German government will take a position on the renewal of the European Central Bank's leadership in a "matter of days". The German Chancellor, Friedrich Merz, wants to accelerate the decision and has announced that he will present a proposal for next week, in a race in which at this moment the Spanish candidate for the presidency, Pablo Hernández de Cos, starts with an advantage to assume the presidency.
“There are agreements in sight, but they are not yet closed,” stated Merz this Friday after meeting with the French President, Emmanuel Macron, on the sidelines of the Dublin summit. The German leader made it clear, however, that the proposal will be agreed upon with his social-democratic government partners.
Hernández de Cos has been gaining support in recent weeks to the detriment of his main opponent, the Dutchman Klaas Knot, in the race to replace the current president, Christine Lagarde. In fact, Merz's statements come the day after it transpired that France is leaning towards endorsing the former governor of the Bank of Spain.
According to the French and German press, the pact would distribute the three positions that will become vacant in the coming months at the monetary institution's leadership. Thus, Berlin would appoint the chief economist while Paris would keep the position of the head of market operations. Besides the post of president, currently held by Lagarde, the Irishman Philip Lane will leave the position of chief economist at the end of May, and the German Isabel Schnabel will leave that of director of market operations on January 3rd.
A hasty departure
Before closing the agreement, however, Merz must find a consensus name that convinces his government partners to fill the German vacancy. Currently, economists Markus Brunnermeier and Tobias Adrian are on the table.
The early departure of Lagarde—who announced she was stepping down because she could no longer remain neutral in the context of the French election—has accelerated the agreements to choose the new leaders of the ECB. The intention of the eurozone leaders is to seal a pact on November 26 during the leaders' summit in Brussels. This would initiate the formal process that requires a formal recommendation from the Eurogroup, the approval of the European Parliament, a positive opinion from the ECB itself, and a final decision once again by the heads of state and government.
