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Danske Bank analysts note that after the surprising resignation of ECB Board member Sabine Lautenschläger yesterday, the German finance ministry announced it will soon propose a “suitable candidate” to succeed her.

Key Quotes

“Both Isabel Schnabel, member of German Council of Economic Experts, and Claudia Buch, vice-president of the Bundesbank, have been mentioned as possible successors. With German monetary hawks in retreat, hope for a similar shift in the fiscal policy sphere gained traction again after former finance minister and renowned fiscal hawk Wolfgang Schäuble seemingly endorsed a fiscal policy rethink and Chancellor Angela Merkel admitted at a conference that politicians must ensure, through with sensible reforms and finance policies, that the ECB is not overburdened.”

“Still, we remain sceptical of a sizeable policy shift on the fiscal front from Germany in the near term, not least because the climate package unveiled on Friday was generally received with disappointment.”