LONDON | For the European Central Bank (ECB), Mr Juergen Stark’s resignation from its executive board on Friday was a “personal” matter, and judging by the reaction on the markets that description turned out to be fitting: at 4:00 pm, the euro was trading against $1.37, down 1.6% and at its lowest level since the end of February.
“No wonder,” as international financial markets, HF expert and Webster Finance Professor Jacob H Schmidt @JACOBHSCHMIDT put it.
This is the press release from the ECB, in which Mr Trichet makes a swift appearance to demonstrate he has some diplomatic skills when required:
“Today, Jürgen Stark, Member of the Executive Board and Governing Council of the European Central Bank (ECB), informed President Jean-Claude Trichet that, for personal reasons, he will resign from his position prior to the end of his term of office on 31 May 2014. Mr Stark will stay on in his current position until a successor is appointed, which, according to the appointment procedure, will be by the end of this year. He has been a Member of the Executive Board and Governing Council since 1 June 2006.
“Having been informed by Jürgen Stark of his decision to resign for personal reasons, President Jean-Claude Trichet thanks him wholeheartedly for his outstanding contribution to European unity over many years.”
Other observers, though, were happy to air starker opinions, like Portuguese TVI EU correspondent Pedro Moreira @PedroMoreiraTVI, who hinted at a possible gain for the ECB and the euro zone in general after the German member’s departure, because:
“Stark was a tough element. Had it been for him, Germany would have left the euro to return to the Deutsche Mark. From a national perspective, I don’t think we’ll miss him [our translation].”
As UK’s BBC explained,
“He was reportedly one of four members of the ECB who voted against last month’s controversial decision to revive a programme of buying the bonds of indebted eurozone nations,”
but some Italian news outlets, like the ECB and Mr Moreira, wouldn’t be so ingenuous and took it on the chin. Reggio Emilia’s Reggionline @Reggionline saw clear motives:
“The ECB wants to help Italy: Stark can’t stand it and resigns.”
Senior Finance Writer at Bloomberg News, Yalman Onaran @Yalman_BN, perhaps with the benefit of being at a New York distance, established an interesting link:
“Why are the Germans deserting the ECB? Juergen Stark resigns a few months after Axel Weber…”
Just to add some non-peripheral context here, there were core-EU voices content that Stark had abandoned his ECB seat. For instance, economics editor at Germany’s business daily Handelsblatt Olaf Storbeck @OlafStorbeck:
“Jürgen Stark resigns? This is jolly good news! He was one of the most orthodox and narrow-minded central bankers.”
Besides, Nouriel Roubini @Nouriel has tweeted that everything is going to be all right:
“Fully agree. Good riddance.”
His words, not ours.