Weber Says Hawkish Views Led to ECB Race Exit
Bundesbank president Axel Weber said a lack of political acceptance in the eurozone for his hawkish monetary views had driven his abrupt decision not to run for European Central Bank presidency.
The central banker sent shockwaves through Europe and angered the German government last week when it emerged he would step aside as Bundesbank president and drop out of the race to succeed Jean-Claude Trichet as head of the ECB.
Mr Weber told magazine Der Spiegel at the weekend that political reactions to his “clear positions” on important ECB decisions, such as his opposition against the purchase of government bonds, had spurred his reluctance to follow Mr Trichet.
“These positions might not have always been helpful for my acceptance in some governments,” he said in the first public explanation of his unexpected decision, which had thrown the race for the ECB presidency wide open and diminished the German government’s chances to push through their own candidate.
Mr Weber has held a tough stance on bail-out countries and is a staunch opponent of activist central bank policy, a view that culminated in his public criticism of bond purchasing program in May last year.
“Therefore I was aware since May that a potential candidacy would be damaged. During this time, my decision has grown not to aspire for this important office,” he said.
The 53-year-old central banker named as a second reason that his hardliner views would likely have isolated him within the ECB.
“The ECB is the bulwark for stability in Europe ... The president has a special position in all this. But if he advocates a minority opinion on essential questions, the credibility of his office suffers,” Mr Weber said
Mr Weber will step aside as Bundesbank president at the end of April – one year before his eight-year-term would have expired – leaving the German government scrambling to quickly decide on a successor.
It aims to present a candidate this week, with Jens Weidmann, Ms Merkel’s economic adviser, widely seen as the frontrunner.
Mr Weber said he did not want to interfere with the decision, but threw his weight behind Mr Weidmann. The economics professor turned central banker called for a rejuvenation of the Bundesbank’s board and praised the economical expertise of his 42-year-old former student.
“The Bundesbank’s executive board has often been equipped with people who were close to retirement age … We need a signal of rejuvenation,” he said.
“Weidmann is an excellent economist,” Mr Weber added. “Despite being young, he has got a lot of experience and is a top professional.”
The announcement of Mr Weber’s early resignation straight after his meeting with chancellor Angela Merkel last Friday has raised doubts about the central bank’s independence.
However, people close to the situation said Mr Weber had already told the Bundesbank’s board late on Tuesday that he would leave at the end of April.
Mr Weber said he had no immediate plans to take a post at a commercial bank and he would not take a new job before 2012.
The central banker has last week been rumored for a senior role at Deutsche Bank, although the likelihood for such a move seems to have fallen following his turbulent announcement about leaving the Bundesbank.