Will Lagarde stick to Draghi's course at the ECB?

The EU Parliament's Economics and Monetary Affairs Committee has recommended Christine Lagarde for the post of ECB president. Commentators criticise the fact that Lagarde, currently IMF chief, has defended current ECB head Mario Draghi's low-interest policy. Others see her embarking on a tricky balancing act.

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Večer (SI) /

Promised change won't come

Christine Lagarde will continue to pursue a European monetary policy that serves the interests of the powerful, Večer fears:

“Despite promises of a greener monetary policy and efforts to strengthen women's rights, she will be dancing to the tune of those who profit most from cheap money. This is not small and medium-sized businesses or ordinary citizens. The cheap money policy benefits above all those who already have inconceivably large sums tucked away in various accounts, particularly in tax havens. These are also the players in modern casino capitalism who couldn't care less about environmental protection, civil rights in general and women's rights in particular.”

De Standaard (BE) /

Growth based on credit

The logic of cheap money could lead to a complete collapse, warns De Standaard:

“At some point things will come to a head. Now that the economy is slowing down again after several good years it is becoming clear that a substantial part of the growth was bought with borrowed money. ... It remains unclear what the consequences will be. ... As long as the financial markets don't send out emergency signals the ship will continue to drift along. But at the lower end of the system a latent anxiety is tangible. People are stubbornly saving their money and the property market is approaching the boiling point. ... All new owners rely on stable high yields. Just as investors rely on rising share prices. What could possibly go wrong?”

L'Opinion (FR) /

Not an easy job

As head of the ECB Christine Lagarde will continually have to deal with the conflicting demands of France and Germany, L'Opinion predicts:

“The current ECB chief, Mario Draghi, is constantly under fire for his monetary policy. It is deemed unconventional and has led to what all German savers hate: negative interest rates. The French take the opposite view: as one of the most indebted countries in Europe they see these interest rates as a gift. Because they mean that the government can pass its budgets and make its deficit and exorbitant public spending look like mere trifling sums. And they dream of the Germans once more increasing their public spending. In this context ECB chief Lagarde faces a very difficult task.”