Lagarde to Leave the ECB Early
The European Central Bank's president will step down on February 7, about nine months before her term ends, saying she wants freedom to speak on matters beyond monetary policy.
Christine Lagarde, president of the European Central Bank, at a European Parliament hearing, March 2025.Illustration by The Good Times, based on a photo by Philippe Buissin / European Union / Wikimedia Commons (European Parliament licence, reuse with credit).
Christine Lagarde will step down as president of the European Central Bank about nine months before her eight-year term ends, the bank announced. The ECB sets interest rates for the countries that use the euro, and it left its key rates unchanged hours after the announcement. At her press conference, Lagarde said she was leaving early so she would be free to speak and engage on matters other than monetary policy. European Council President António Costa said the process of choosing her successor would begin at once. EU leaders appoint the ECB president on a recommendation from the Council of the EU, after consulting the European Parliament and the ECB's Governing Council. Klaas Knot, the former head of the Dutch central bank, and Pablo Hernández de Cos, a former governor of the Bank of Spain who runs the Bank for International Settlements, are seen as the leading candidates. The timing means French President Emmanuel Macron, who leaves office next spring, will have a say in the choice.
The announcement
Lagarde will leave on February 7, 2027. She informed the ECB's Governing Council and Costa of her decision, the bank said, adding that the council "thanked President Lagarde warmly and gave her a long standing ovation," according to the ECB's release and Euronews. The ECB left its deposit rate at 2.5% the same day, Euronews reported; Politico Europe reported that the bank left its key rates unchanged.
Her reasons
Lagarde said her post required her to stay neutral and that she wanted freedom to express her views and to engage on matters that are not monetary policy, according to Politico Europe and Euronews. The ECB gave no details of her plans after leaving, Politico Europe reported.
Choosing a successor
Costa said the appointment process "will be initiated today and will proceed without delay," according to his statement and Euronews. Eurogroup President Kyriakos Pierrakakis said finance ministers would act swiftly to prepare their recommendation, according to his statement and Politico Europe. The European Council appoints the president after a recommendation from the Council of the EU and consultation with the European Parliament and the ECB's Governing Council, the Council's own guidance and Euronews say. Knot, who led the Dutch central bank from 2011 to 2025, and Hernández de Cos are seen as the frontrunners, Euronews and Politico Europe reported.
The top job is one of at least three Executive Board seats coming open. Isabel Schnabel is leaving in January to join the International Monetary Fund, and chief economist Philip Lane's term ends in May, Euronews and Politico Europe reported.
The French calendar
France elects a new president next spring, and Macron cannot run again. Leaving in February means Macron will have a say in choosing Lagarde's successor before he leaves office, Euronews and Politico Europe reported.