The pact between the two large countries of the euro zone to renew the leadership of the European Central Bank (ECB) is a matter of “a few days” and in it the Spanish Pablo Hernández de Cos is drawn as the favorite for the presidency. The Chancellor of Germany, Friedrich Merz, admitted this this Friday, after meeting the French President, Emmanuel Macron, late Thursday afternoon. “There are agreements in perspective, but we have not yet closed them,” he said in Dublin, where he went to participate in the informal European Council being held in the Irish capital. The German leader, however, has made it very clear that he must first close the pact at home with his social democratic partners: "We want to present the German proposal next week."
France is leaning towards the former governor of the Bank of Spain as a replacement for Christine Lagarde. The now general director of the Bank for International Settlements helps his more moderate profile in monetary policy in the face of the complicated French fiscal situation. However, Merz has made it clear to the press that “the talks have not yet concluded either.” Therefore, although Spain seems to be getting closer to having, for the first time, a president of the ECB, it still needs to be taken for granted.
The pact that is making its way, according to the French and German press, consists of Berlin appointing the chief economist and Paris appointing the replacement for Isabel Schnabel, a member of the council now in charge of market operations of the highest monetary authority of the euro zone. Lagarde will leave office next February.
Sebastian Hile, deputy spokesperson for the German Government, avoided talking about specific names this Friday but stressed that everything will depend on the representation that his country has at the top of the ECB: "The federal government sets the objective that Germany has adequate representation in the leadership bodies of the ECB." According to the newspaper Handelsblatt, this position he aspires to is that of chief economist. The name to succeed the Irishman Philip Lane, who ends his term in May, would be the economist and Princeton University professor Markus Brunnermeier. The chief economist position is considered the second most important at the bank.
Hernández de Cos (Madrid, 1971) is former governor of the Bank of Spain and current general director of the Bank for International Settlements, an institution dependent on most of the world's central banks. His candidacy would be supported by Macron as an alternative to Germany's favorite, the Dutch Klaas Knot. Germany would accept that Knot not be Lagarde's successor in exchange for recovering, 11 years later, the position of chief economist. If Knot surpassed Hernández de Cos and was elected president, the position of chief economist would in that case go to France and Germany would maintain its current representation as head of markets, according to Handelsblatt.
Hile has assured that at the end of the year there will be an agreement for the renewal of the ECB leadership. He also did not want to confirm or deny that Merz and his vice chancellor, Finance Minister Lars Klingbeil, disagree about the German strategy. Klingbeil is the president of the SPD Social Democrats, who govern in coalition with the CDU.
