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Economy expert Isabel Schnabel: Bonn University Professor to become ECB Director

Economy expert Isabel Schnabel : Bonn University Professor to become ECB Director

Isabel Schnabel still teaches economics at the University of Bonn, but soon she could take a seat on the Executive Board of the European Central Bank (ECB). The outgoing Sabine Lautenschläger will vacate that position

According to the "Süddeutsche Zeitung", the German government wants to nominate Isabel Schnabel, professor of economics, for the vacant position on the Executive Board of the European Central Bank (ECB). According to the newspaper, the cabinet will decide on a corresponding proposal by Finance Minister Olaf Scholz (SPD) on Wednesday. Also, according to the newspaper, the proposal has been agreed with Chancellor Angela Merkel (CDU) and Interior Minister Horst Seehofer (CSU).

A spokeswoman for the Ministry of Finance did not want to comment on the report. However, two other sources, including one close to the ECB, confirmed the information.

The 48-year-old Schnabel is one of the economic experts of the federal government. She is to succeed Sabine Lautenschläger, who recently announced that she will leave the Executive Board prematurely on October 31. In addition to ECB President Mario Draghi, the Board has five other members. Together with the 19 national central bank governors of the euro countries, they form the Governing Council, the most important decision-making body of the ECB, which sets the monetary policy course in the euro area.

Lautenschläger's withdrawal was apparently triggered by differences of opinion over the ECB's ultra-loose monetary policy - above all the recent interest rate decision by the central bank and the resumption of billion-dollar bond purchases. Following their announcement, the Ministry of Finance announced that Germany would again seek to fill the post with a German candidate. The new member of the Executive Board will then be appointed after a hearing before the EU Parliament by the European Council.

Schnabel teaches at the University of Bonn. She is regarded as a supporter of the ECB's monetary policy under Draghi, who will soon hand over his post to Christine Lagarde.

Criticism of Schnabel's personality came from the FDP. With their nomination, the government "will comply with the previous majorities within the ECB", said financial expert Florian Toncar to the news agency AFP. "Necessary and right" would have been the proposal of a person who "fights with full conviction for a different monetary policy", he added. The ECB's current actions are a "threat to pensions, to the stability of the financial system" and ultimately the credibility of the ECB.

(Original text: AFP / Translation: Mareike Graepel)