Christine Lagarde expected to step down early from ECB, FT reports

Wednesday 18 - 09:20

By: Dakir Madiha

Christine Lagarde expected to step down early from ECB, FT reports

Christine Lagarde is expected to leave the European Central Bank before the end of her eight year term as president, which is due to expire in October 2027, according to a report published by the Financial Times on February 18, 2026. The development would mark a reversal for Lagarde, who less than a year ago said she was determined to complete her mandate at the helm of the euro zone’s most powerful monetary institution.

The reported early departure comes amid mounting speculation over succession at the ECB, intensified by the recent resignation of Banque de France Governor François Villeroy de Galhau. On February 9, Villeroy unexpectedly announced he would step down in June, about 18 months before the scheduled end of his term, prompting broader discussions among European officials about accelerating key appointments.

These potential changes are unfolding against a backdrop of political uncertainty surrounding France’s 2027 presidential election. Current polling indicates that the far right Rassemblement National, led by Marine Le Pen or her ally Jordan Bardella, could win the vote scheduled to begin in April 2027. According to Bloomberg, European leaders may prefer to finalize the ECB succession process while President Emmanuel Macron remains in office.

“There are good reasons to take decisions before the French elections,” Emanuel Moench, a professor at the Frankfurt School of Finance and a former Bundesbank official, told Bloomberg. He said the process would likely be easier under Macron than under Le Pen or Bardella, both of whom have previously expressed markedly different views on the role of the ECB.

Lagarde’s anticipated departure would trigger a high stakes contest to lead euro zone monetary policy. A Bloomberg survey of economists published in January identified former Dutch central bank chief Klaas Knot as the most likely successor. He was followed by Bank for International Settlements director Pablo Hernández de Cos and Bundesbank President Joachim Nagel.

Isabel Schnabel, a member of the ECB’s executive board, has also signaled openness to taking on the presidency. In a December interview, she said she would be prepared to serve if asked.

The leadership transition would form part of a broader reshuffle at the ECB, with four of the institution’s six executive board seats set to change hands by the end of 2027. Croatian central bank governor Boris Vujčić was recently appointed as the ECB’s new vice president, becoming the first representative from Eastern Europe to join the executive board.

Lagarde, 70, assumed the presidency in November 2019 after serving as managing director of the International Monetary Fund from 2011 to 2019. During her tenure, the ECB navigated the economic fallout from the Covid 19 pandemic and a surge in inflation following Russia’s invasion of Ukraine.