European Central Bank President Christine Lagarde will step down on 7 February 2027, almost nine months before her eight-year term was due to end in late October 2027, the bank announced on Thursday. Lagarde informed the ECB’s Governing Council and European Council President Antonio Costa of her decision, and the European Union launched the process to choose her successor the same day. The announcement came alongside a decision to hold all three key ECB interest rates unchanged, with the deposit rate staying at 2.50 percent, even though eurozone inflation rebounded to 3.8 percent in September, nearly double the bank’s 2 percent target. Lagarde, who has led the bank since 2019 after heading the International Monetary Fund, said she wanted the freedom to engage on matters that are not monetary policy matters. Possible successors mentioned include former Dutch central bank governor Klaas Knot and former Spanish central bank governor Pablo Hernandez de Cos. Whoever takes over will inherit high inflation, rising bond yields and geopolitical pressure, making the succession one of Europe’s most important appointments of 2027. Sources: Reuters, MercoPress (ECB statement). Written in our own words for information only.