Junker to Remain Head of Eurogroup

The official statement out of the European Finance Minister’s meeting point to Junker staying as the head of the group as his term is close to an end and no clear successor is in line. Due to political pressure he might be asked not to finish his new term of 7 years and France and Germany’s representatives to alternate in the role. This is another example of the austerity versus stimulus debate that rages on at the heart of the euro crisis.

Jean-Claude Juncker, the Luxembourg premier considered a founding father of the euro, was asked to stay on as head of the eurozone finance ministers group, an EU source said on Tuesday.

“The mandate is for two and a half years but he will only serve for part of that,» another EU source told AFP.

Juncker, who has held the post since 2005, was due to step down in exactly one week, on July 17. He has himself suggested remaining in the post for a further six months.

His renomination was agreed by his peers during almost nine hours of talks Monday that lasted well after midnight.

Finding a successor has been tricky, with the most likely new candidate, German Finance Minister Wolfgang Schaeuble, running into French opposition.

Juncker favoured handing over the post but agreed under French pressure to remain another six months on condition that the head of the Luxembourg central bank, Yves Mersch, should take a vacant board seat at the European Central Bank.

The Eurogroup agreed to nominate Mersch to the ECB board during the talks, with the formal adoption to be agreed later Tuesday when all 27 European Union finance ministers meet.

Mersch, 62, has been head of the Luxembourg central bank since 1998 and will replace Spain’s Manuel Gonzalez Paramo, who stepped down from the ECB post in May.

via ekathimerini

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza