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Spain to Name Escriva Central Bank Governor, Expansion Says

Jose Luis Escriva Photographer: Paul Hanna/Bloomberg (Paul Hanna/Bloomberg)

(Bloomberg) -- Spain will name Jose Luis Escriva, currently the minister for digital affairs, as the new Bank of Spain governor, Expansion reported, citing people it didn’t identify.

The government is set to announce the new central bank head on Wednesday, ending prolonged speculation over who will fill a vacancy that’s been empty for almost three months. Economy Minister Carlos Cuerpo has requested to address lawmakers on the economic committee to unveil the appointment, according to an agenda posted on the parliament’s website.

The European Central Bank appears increasingly confident that it has defeated the euro area’s worst-ever bout of inflation — an episode that saw policymakers hike borrowing costs at unprecedented speed. As a member of the Governing Council, he’ll join the debate over how quickly monetary policy can now be loosened, after an initial reduction in the deposit rate to 3.75% in June.

Spain’s government has suggested it wants the new policymaker to be able to attend the ECB’s next meeting, which is set for Sept. 11-12 in Frankfurt. Pablo Hernandez de Cos’s term as governor ended in June.

Spokespeople at the economy ministry and the Bank of Spain declined to comment on the Expansion report on Tuesday.

Escriva started his career at the Bank of Spain’s research team in the mid-1980s after graduating from the Complutense University in Madrid with a degree in economics. From there, he moved on to the now defunct European Monetary Institute and then the ECB, where he led the monetary policy division.

His earlier stint at the ECB should give him an edge — hardly any of the other Governing Council members have previously worked at the Frankfurt-based institution.

He switched to the private sector in 2004, spending eight years at BBVA SA. He then served two years at the Bank of International Settlements and ran the Spanish fiscal watchdog from 2014 to 2020. Finally, he joined the government as an independent, and held the post of minister for pensions between 2020 and 2023. 

Unlike his predecessor Hernandez de Cos, whose period before becoming governor was spent as a technocrat avoiding controversy, Escriva has long been known for his combative nature.

At the start of the pandemic he surprised fellow Cabinet members, most of whom had barely interacted with him before he joined the executive, clashing with then Economy Minister Nadia Calvino over how to deploy state aid, aligning himself instead with ministers representing the government coalition’s anti-establishment junior partner. 

At the time, Escriva defended the need to act aggressively to prop up the economy and accused Calvino and Budget Minister Maria Jesus Montero of being too conservative. 

By then he was already a key adviser to Prime Minister Pedro Sanchez, regularly sharing opinions and analysis privately with him on macroeconomics, something he continues to do to this day. 

Escriva won’t be the only former minister in the Governing Council, joining the ranks of the central bank heads of Portugal, Greece and Slovakia. President Christine Lagarde was also a minister before heading the International Monetary Fund — and then the ECB — and her vice president, Luis de Guindos, was Spain’s finance chief before moving to Frankfurt.

The choice of the new Bank of Spain governor has been delayed because Sanchez’s government and the People’s Party, its main opponent, failed to reach an agreement on a candidate. Although it’s the executive’s prerogative to pick the central bank head, convention dictates that it is done together with the opposition, who names the deputy. 

Sanchez’s team had already proposed naming Escriva, but the PP had said it’s against giving the job to a serving minister.

--With assistance from Thomas Gualtieri.

(Updates with details on Escriva from sixth paragraph.)

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