Early exit by Lagarde gives EU time to appoint new central bank chief

European Central Bank President Christine Lagarde resigned on Thursday, ending months of speculation about her future just ​as Europe enters a period of rising economic volatility and divisive electoral politics, particularly in her native France. Lagarde will step down on February 7, giving current European Union leaders time ‌to pick her successor before a French presidential election that polls show far-right candidate Marine Le Pen is favoured to win. Her term was due to expire next October. The move comes as the ECB battles inflation risks from an Iran war-driven oil shock while a sharp rise in bond yields, especially in France, threatens to dampen growth. “I leave this institution with a sense of good work done and an ECB that is fit for the future,” Lagarde, 70, said in a short video shared on social media.

A ​source with direct knowledge of the matter said Lagarde, a former French finance minister and head of the International Monetary Fund, had resigned so she could weigh in on political matters in France ​and globally. As ECB president, she was expected to remain neutral to safeguard the institution’s independence. Only three months ago, Lagarde dismissed talk of an early exit, ⁠saying she could not leave the ECB with inflationary “clouds” gathering on the horizon. FRANCE’S RIGHT-WING PARTY LAMENTS MOVE Jean-Philippe Tanguy, charged with drafting economic policy for Le Pen’s election manifesto, told Reuters Lagarde’s move showed contempt for the ​rule of law: “I saw this coming. Another insult in our direction – lamentable. ” Markus Ferber, a German member of the European parliament for the centre-right European People’s Party, also said Lagarde’s early resignation sent “the wrong signal” given high ​inflation, nervous bond markets and looming elections. “If…