Bank of Italy Governor Mario Draghi was appointed as the next president of the European Central Bank, avoiding a delay that risked complicating the handling of the sovereign-debt crisis.
Draghi’s appointment was approved at a summit of European Union leaders in Brussels today, an EU spokesman said. The 63- year-old Italian will take over from Jean-Claude Trichet as the head of the Frankfurt-based ECB, beginning an eight-year term on Nov. 1.
The announcement was made after last-minute wrangling. French President Nicolas Sarkozy had sought assurances that another Italian on the ECB’s six-member board, Lorenzo Bini Smaghi, would quit early to make way for a Frenchman, three officials said earlier today.
Sarkozy was backed into a corner by the release of a draft statement, prepared overnight, that proclaimed Draghi as the next ECB president. Coming as European leaders sought to project a united front over a second bailout for debt-stricken Greece, the deal was clouded by the same political maneuvering that marked the appointment of the outgoing ECB president.
A Massachusetts Institute of Technology-trained economist with a stint at Goldman Sachs Group Inc. on his resume, Draghi had already been backed by finance ministers and was the only candidate to take over the Frankfurt-based ECB.
The leaders praised the ECB’s record of maintaining price stability in the region, according to draft summit conclusions obtained by Bloomberg News.
“The euro is based on sound fundamentals, and we are deeply satisfied with the track record of price stability achieved since the inception of the euro,” they said in the draft text, which will be finalized later today.
The euro was lower against the dollar, on course for a third weekly drop, the longest run since February. The euro was at $1.4229 at 11:32 a.m. in London, down 0.2 percent on the day, after trading as low as $1.4197 earlier.