Spanish Economy Minister Luis de Guindos has been chosen by euro zone ministers on Monday afternoon to replace ECB Vice President Vitor Constancio. Ireland withdrew the only other candidate, central-bank governor Philip Lane, at the start of the meeting. De Guindos’ nomination will be formally adopted at a meeting of EU heads of state at the end of March and he will take up his new post on June 1, as reported by Bloomberg.
The decision puts Spain back on the Executive Board after a six-year absence, a situation Prime Minister Mariano Rajoy long complained was unfair.
Investors have started speculating about how could monetary policy change with the Spanish finance minister taking the No.2 job post at the central bank given that it prepares to unwind unprecedented monetary stimulus after a decade of crisis. The key question is to know whether he’ll be a dove or a hawk and how could he tip the balance of power in Frankfurt.
Another doubt about De Guindos’ appointment has revolved around his current position As Spanish Ministry of Economy which has been considered an impediment in maintaining the independence of the ECB.
“I have been a minister, but to be a minister is something that does not limit the defense that I make on the independence of the European Central Bank. I will defend the independence of the European Central Bank,” de Guindos told reporters after his appointment.
