03rd July 2019
Andrea Iannelli, Investment Director, Fidelity International, comments on Christine Largarde’s nomination to succeed Mario Draghi at the helm of the ECB:
“The nomination of Mrs. Lagarde to succeed Mario Draghi at the helm of the ECB is unconventional given her background. She brings no experience in central banking, having played more “political” than policy-related roles in her career.
“Draghi’s shoes would be hard to fill by any successor, after his impressive tenure and the role that the ECB played under his watch. More importantly, the politics around the ECB are now more intense than in the past, and Lagarde will perhaps focus more on that than building an economic and monetary policy framework to shape policy.
“It is important to note, however, that the role of the president of the Governing Council (GC) is less about setting a view and monetary policy stance, and more about consensus building among the GC members who can have some very contrasting views at times.
“On this basis, Mrs Lagarde appointment is unlikely to bring a major shift in stance by the ECB, but rather continuity, following the path set under Draghi. Over the longer term, however, she will have to work hard to ensure that the ECB’s credibility remains as strong as it has been under her predecessor.”