ECB’s Panetta seen defying calls to be Italian finance minister - Financial Markets Worldwide

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Economy 58 minutes ago (Sep 20, 2022 12:27PM ET)

ECB's Panetta seen defying calls to be Italian finance minister - sources
© Reuters. FILE PHOTO: Fabio Panetta, director of international and European relations at the European Central Bank, attends the award ceremony for the Order of Merit of the Federal Republic of Germany at Bellevue Palace in Berlin, Germany, January 31, 2020. REUTERS

By Giuseppe Fonte and Giselda Vagnoni

ROME (Reuters) – ECB board member Fabio Panetta is resisting calls from Giorgia Meloni, the front-runner to be Italy’s next prime minister, to take the job of economy minister should the rightist bloc win election on Sunday, two political sources told Reuters.

Meloni, the leader of the Brothers of Italy party, wants Panetta to replace Daniele Franco at the helm of the Italian Treasury, but Panetta has made it clear he is not interested in the role, the sources said.

The central banker would instead prefer the job of Bank of Italy governor, they added, asking not to be named due to the sensitivity of the matter.

Panetta, 63, is a veteran of more than three decades at Italy’s central bank and has sat on the Executive Board of the European Central Bank (ECB) since the start of 2020.

The mandate of Ignazio Visco, who is 72 and has been leading the Bank of Italy since 2011, is due to end in October of next year.

A third, separate source close to the matter confirmed Panetta was the leading candidate to replace Visco.

The government plays a key role in the appointment of the head of Bank of Italy, under a complicated procedure which also requires consultation with the central bank’s main internal body, known as its “Superior Council”.

A spokesperson for the ECB said: “Mr Panetta declined to comment.”

Meloni’s office was not available for comment.

The new economy minister will have to help Italy cope with a worsening economic outlook due to the energy crisis exacerbated by the Ukraine war, and rising prices for many other goods.

The ECB raised its key interest rates by an unprecedented 75 basis points this month and promised further hikes, prioritising the fight against inflation and complicating Italy’s efforts to head off the threat of recession and reduce public debt.

Meloni said on Tuesday in a television interview that it was not the time to talk about ministerial jobs.

She had already declined to answer over a possible role in a future conservative government for Panetta in an interview with Reuters on Aug. 25, but at that time added Panetta was a person “of the highest standing”.

League leader Matteo Salvini, an ally of Meloni in the rightist bloc, voiced his opposition to the possibility of giving technocrats key jobs, including the economy ministry, in any new government.

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