© EPA/ GIAN EHRENZELLER The President of the ECB is appointed for eight years.
Christine Lagarde, the chief of the European Central Bank, is anticipated to exit her position at the ECB prior to the culmination of her eight-year tenure in October 2027, the FT divulged , citing an informant.
Lagarde, who assumed her role at the ECB in November 2019, reportedly intends to resign before the upcoming French presidential elections next April.
According to a source knowledgeable about Lagarde’s intentions, she desires to grant French President Emmanuel Macron and German Chancellor Friedrich Merz the chance to nominate a fresh leader for one of the EU’s most vital organizations. The precise timing of Lagarde’s departure is currently unknown.
“President Lagarde is completely dedicated to her duties and has not made any determinations regarding the conclusion of her term,” the ECB stated.
European economists polled by the FT this past December view the former Spanish central bank governor Pablo Hernandez de Cos and his Dutch counterpart Klaas Knot as frontrunners for the next ECB presidency. ECB executive board member Isabelle Schnabel has voiced her interest in the role. German central bank head Joachim Nagel is also keen on the ECB presidency.
Sources close to discussions in Paris informed the FT that Macron, who is unable to seek a third term as French president, is keen to influence the selection of Lagarde’s replacement.
Lagarde’s possible choice could follow the announcement by French central bank governor François Villeroy de Gallo this month that he would resign in June, 18 months prior to the end of his term. While Villeroy de Gallo stated his decision to step down was to join a charity, commentators suggest Macron has paved the way for a new nomination.
The upcoming French presidential election next April will be pivotal for the eurozone’s second-largest economy and the EU overall, with Marine Le Pen, the leader of the far-right National Rally, leading her competitors in survey results.
Even though Le Pen could face disqualification as a National Rally candidate due to a conviction last year for misusing European Parliament funds, she has declared that her “protege,” Jordan Bardella, would succeed her if necessary.
Both Le Pen, who is contesting her conviction, and Bardella are Eurosceptic, which might complicate affairs with European bodies such as the ECB.
Macron has also taken measures to “secure” other significant positions until 2027, recently appointing a close ally as the director of the national audit office.
Recently, Lagarde expressed that she took the ECB post believing her term would be five years, which observers have interpreted as preparation for an early departure. In an interview with Bloomberg TV, she recounted telling Macron after accepting the ECB presidency: “I will be in Frankfurt (where the ECB’s headquarters are located) for five years.” Macron responded: “No, eight years.”
Last summer, an ECB spokesperson emphasized that Lagarde had “resolved to complete her [eight-year] term,” after former World Economic Forum chairman Klaus Schwab indicated that the European Central Bank president had contemplated resigning early to head the WEF.
Lagarde’s tenure leading the ECB has included several crises, notably the COVID-19 pandemic, Russia’s comprehensive invasion of Ukraine, and a trade standoff with the United States. Inflation in the Eurozone surged to almost 11% at the close of 2022 as energy costs sharply increased after Russia’s all-out assault on Ukraine and worldwide supply networks endured disruptions linked to the pandemic.
Lagarde’s designation as ECB president occurred following a surprising agreement reached by Macron and then-German Chancellor Angela Merkel in 2019. They concurred that Lagarde would direct the ECB while then-German Defense Minister Ursula von der Leyen would become president of the European Commission.