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ECB: Christine Lagarde at the European Parliament's grill

2019-09-04T03:02:01.603Z

ECB: Christine Lagarde at the European Parliament's grill



Frankfurt (AFP)

The future president of the European Central Bank, Christine Lagarde, a newcomer to monetary policy with a new profile, is holding her first public test on Wednesday in the European Parliament, in a troubled economic period.

MEPs plan to hear the current head of the International Monetary Fund (IMF) from 08.30 GMT and for two and a half hours, while his eight-year term as head of the ECB is due to start on 1 November.

If their vote in the evening will be consultative, without the power of blockage, parliamentarians should cook the French on her career as a business lawyer entered politics and marked by a series of financial crises since 2008.

After leading the US firm Baker McKenzie until 2005, she was appointed by Nicolas Sarkozy to the Ministry of Foreign Trade and Finance until 2011, before taking the reins of the IMF for the past eight years.

All without having ever worked in a central bank, unlike its predecessors and the main candidates mentioned for this post.

At the day's hearing, the leader will have to "convincingly demonstrate that she has the necessary currency expertise," German Conservative MEP Markus Ferber told AFP.

- Heavy inheritance -

His compatriot in the Greens, Sven Giegold, said he had "sympathy" for "the fact that a woman occupies this important political position," he told AFP, even if parliamentarians must "remain critical ".

Aged 63, the silver-haired Frenchwoman will have the difficult task of succeeding the Italian Mario Draghi, who has marked the institute of Frankfurt by forging a lot of tools to alternately safeguard the single currency and support the economy of the region.

Also, the intention displayed by Ms. Lagarde to "find consensus" in the institution's Board of Governors will soon be put to the test. This strong body of twenty-five members appears divided on the attitude to hold against a slow economy in the euro zone.

For the former French minister, in a document submitted last Thursday to Parliament, Mario Draghi is right to want to maintain a generous monetary cap, even if the ECB has failed for years to reach its inflation target slightly less than 2%.

It ensures, however, want to ensure the "implications" of monetary policy "for the banking sector", whose low rates lead to profitability, and for "financial stability in general".

- Call to the States -

Not sure that this is enough to appease critics, especially from Germany, on a monetary policy considered "excessively generous", laments to the AFP the German liberal election Nicola Beer.

By flooding the liquidity market and setting interest rates at their all-time low, the ECB has "placed EU member governments in an awake and expropriated coma of savers, instead of achieving structural and structural changes. stimulate public sector and economic investment, "accuses the MEP.

Christine Lagarde warns that monetary policy "can not increase the long-term growth potential of states," calling on the region's governments to coordinate their economic policies and set up a joint budget response in the event of a crisis.

For years, Mario Draghi had made a similar speech, recalling that the ECB alone could not revive the economy, but without being really heard.

Sven Giegold hopes that Ms. Lagarde, more broken than her predecessor in the dialogue with politicians, "will speak an even clearer language" to address the rulers in the euro zone.

© 2019 AFP

Source: france24

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