The race to lead the European Central Bank (ECB) is formally under way.
Eurozone governments have until this Friday to nominate a successor to Christine Lagarde, and the bloc’s finance ministers will review the names at a meeting on 9 November, a spokesperson for the Eurogroup, which brings together eurozone finance ministers, told Euronews.
Following Lagarde’s letter to European Council President António Costa last Thursday, “the Council of the EU has initiated the procedure for appointing a successor to the ECB President,” the spokesperson said.
“The members of the ECB Executive Board are appointed by the European Council, which takes its decision based on a Council Recommendation on a candidate,” they explained, referring to EU leaders and national ministers, respectively.
Only the countries that use the euro vote on that recommendation, which is why these appointments are discussed in the Eurogroup beforehand.
Its president, Greek Finance Minister Kyriakos Pierrakakis, “has called on member states to send their nominations by Friday 6 November,” the spokesperson added, concluding that “the Eurogroup, at its meeting on 9 November, will take stock of the nominations.”
A candidate will need the backing of at least 16 of the 21 eurozone countries, representing at least 65% of the bloc’s population.
EU leaders then make the final call, once the European Parliament and the ECB’s Governing Council have given their opinions.
Why Lagarde is leaving
Lagarde announced last week that she would leave on 7 February 2027, cutting her eight-year term short by almost nine months.
Speaking to reporters in Frankfurt later that day, she said leaving would give her the freedom to speak out beyond monetary policy.
“I don’t think that I can remain neutral,” Lagarde said. “I’m interested in the truth, and I see the truth being very often damaged, contradicted by misrepresentation.”
However, Lagarde declined to say whether she would back a candidate in France’s presidential election in April 2027.
As Euronews has reported since February, rumours throughout the year have linked her timing to the elections in France, as an early exit gives French President Emmanuel Macron and German Chancellor Friedrich Merz a say over who replaces her while the far right polls strongly ahead of the April vote.
Lagarde promised “perfect continuity of business”, describing the ECB as “solid, strong like a rock”.
The central bank kept its deposit rate at 2.5% on the same day, and she will chair two more rate-setting meetings, in December and February.
The frontrunners
Two names lead the race for the ECB top job, both publicly backed by their governments in September, weeks before Lagarde’s announcement.
One is Pablo Hernández de Cos, general manager of the Bank for International Settlements (BIS), often called the central bank of central banks, and former governor of the Bank of Spain from 2018 to 2024.
Spanish Prime Minister Pedro Sánchez endorsed him in a Bloomberg interview on 23 September, cementing Spain’s first-ever bid for the ECB presidency. Unusually, Spain’s opposition leader Alberto Núñez Feijóo also backed him in October ahead of the snap election this month.
The other main candidate is Klaas Knot, who led the Dutch central bank for 14 years until 2025. A day after Sánchez’s endorsement, Dutch Prime Minister Rob Jetten told Bloomberg that Knot would be a “perfect fit” for many countries.
Prediction markets also point to a two-horse race.
As of Tuesday morning, traders on Kalshi gave Hernández de Cos a 34% chance of getting the job and Knot 31%, while on Polymarket the gap was wider, at 41% and 30% respectively.
On both platforms, former Bank of France governor François Villeroy de Galhau, who quit in February, came third, at 5% and 13%, though only a few thousand dollars have been wagered on each market.
Bundesbank President Joachim Nagel has also previously come up in the race, even though no German has ever led the ECB.
The presidency is only part of the negotiations.
Germany’s Isabel Schnabel, who oversees the ECB’s market operations, departs for the IMF on 3 January, and the term of Irish chief economist Philip Lane runs out at the end of May next year.
With half of the six-member Executive Board changing hands within five months, capitals are expected to bargain over the three posts as a package.
Paris is likely to target the chief economist post instead of a third French presidency, while Madrid wants a seat back on the board after losing the vice-presidency this year.