Summit to give clues on likely head of ECB

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The Independent Online
The Euro summit, due to finish this evening, may provide clues about the yet-to-be-chosen head of the European Central Bank (ECB), an issue which could be crucial to EMU's success.

Rita Schuhmacher of Nikko Europe said: "I think it [a signal about the likely ECB head] is more likely than many people expect ... It must be a candidate who has the confidence of the markets".

The markets' favoured candidate is Wim Duisenberg, the Bundesbank-backed Dutchman. Michael Lewis of Deutsche Morgan Grenfell remarked: "The markets are quite nervous that some political deal could be done over the head of the ECB. Markets really don't like politicians interfering with central banks, as politicians typically try and engineer weaker currencies".

There has been speculation that the French could withdraw the candidature of Jean-Claude Trichet, governor of the Bank of France, in return for certain concessions, such as a French-approved head of the European Bank for Reconstruction and Development.