Ireland Springs Surprise as Makhlouf Named as Central Bank Head

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Ireland named Gabriel Makhlouf, chief economic and financial adviser to New Zealand’s government, as the nation’s new central bank governor in a surprise appointment.

Makhlouf, 52, will succeed Philip Lane, who is moving to the European Central Bank, according to the finance ministry in Dublin. While Bloomberg News first reported Makhlouf as a possible contender earlier on Wednesday, Deputy Governor Sharon Donnery had been the bookmaker’s favorite.

Ireland Springs Surprise as Makhlouf Named as Central Bank Head

Born in Egypt of British and Greek parentage, Makhlouf’s appointment continues a trend of hiring of foreigners with international experience for central banks in recent years. Mark Carney, a Canadian by birth, is nearing the end of his term as Bank of England Governor, while Stanley Fischer served as Vice Chairman of the Federal Reserve having previously run the Bank of Israel.

Makhlouf is head of New Zealand’s Treasury, having previously worked in the U.K. civil service where his responsibilities included policy development on domestic and international tax and welfare policy issues.

For Donnery, it’s a second blow in less than a year. She was considered the frontrunner to head the ECB’s supervision arm, but lost out to Italy’s Andrea Enria when policy makers cast a secret ballot in November. That in part may have been because her selection could have been an obstacle to Lane being named the ECB’s chief economist a few months later.

The ECB’s rebuff of Donnery undermined the institution’s gender-diversity drive. Just one of the six policy makers on the current Executive Board -- which is appointed by euro-area governments -- is female, and every single central bank chief in the region is male. The ECB has repeatedly called for more women in the Executive Board and the Governing Council.

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