Jürgen Stark, chief economist, member of the executive board and governing council of the European Central Bank (ECB) has resigned for personal reasons, prior to the end of his term of office onMay 31, 2014.
Stark, who has been a member of both the board and the council since June 1 2006, will stay on in his current position until a successor is appointed, which, according to the appointment procedure, will be by the end of this year, says the ECB.
Despite the official line from the ECB, rumours are circulating that Stark has stepped down from his post because of a conflict over the central bank’s controversial bond-buying programme, according to sources talking to a major newswire.
Stark was one of four members of the ECB's policymaking governing council which voted against the decision to restart the bond-buying programme and start buying Italian and Spanish debt, say sources.
Former Bundesbank President Axel Weber also resigned in February this year, amid opposition for the same bond buying programme.
The rumours clearly did nothing to quell fears that the ECB has become increasingly fractured as the euro tumbled to around €1.3727 as opposed €1.44 at the August 31 close.
“We have to put the situation into perspective,” says Marc Ostwald, financial markets strategist at Monument Securities. “We don’t know exactly why he is leaving and everyone is assuming that it is over the bond buying programme. However, the euro dropped off a cliff because of the breakdown in communications from the ECB and the markets lack confidence in the policymakers’ ability to sort the eurozone.”
Related Articles:
Europe: When will anyone other than the ECB start buying Europe's debts?