Germany's Schnabel will oversee ECB money-printing programme

FILE PHOTO: Isabel Schnabel, member of the German advisory board of economic experts attends the 29th Frankfurt European Banking Congress (EBC) at the Old Opera house in Frankfurt, Germany November 22, 2019. REUTERS/Ralph Orlowski

FRANKFURT (Reuters) - Germany’s new appointee to the European Central Bank’s board, Isabel Schnabel, has been given responsibility over the ECB’s market operations, which includes running its vast money-printing programme, the ECB said.

The appointment, part of a broader portfolio reshuffle on the ECB’s executive board under its new president, Christine Lagarde, marks a diplomatic victory for Germany, where the central bank’s easy-money policy is deeply unpopular.

Schnabel herself has said she would have voted against restarting the multi-trillion-euro bond-buying scheme in September, although she considers it a valid instrument and sees the need to maintain an easy policy.

Under the reshuffle, published on the ECB’s website, its other new board member, Italy’s Fabio Panetta, will represent the central bank at international forums.

Those were the most coveted portfolios after Benoit Coeure’s term ran out on Dec 31.

Among other changes, Schnabel will run the ECB’s research department, previously the remit of vice-president Luis de Guindos, who will now be responsible for risk management.

This was one of the portfolios held by Sabine Lautenschlaeger, Germany’s previous board representative, until she unexpectedly resigned in the autumn out of disagreement with the ECB’s course.

The ECB’s six-people executive board runs the institution and makes proposals to the decision-making governing council, which includes the heads of the euro zone’s 19 national central banks.

While executive board members are meant to be independent of their country of origin, they are put forward by national governments. Germany, France and Italy, the euro zone’s biggest economies, have de facto permanent seats.

Reporting By Francesco Canepa; editing by John Stonestreet, Larry King