Benoît Cœuré

Benoît Cœuré
Born	17 March 1969 Grenoble, France
Education	École Polytechnique
Occupation	Member of the Executive Board of the European Central Bank

Benoît Cœuré (born 17 March 1969^[1]) is a French economist who was appointed to the Executive Board of the European Central Bank (ECB) in 2011.

Career

Cœuré taught economics at l'Ecole Polytechnique^[1] and was chief economist, No. 2 official,^[2] head of multilateral affairs and development, and head of France’s debt-management office in the country's finance ministry.^[3] From 2007 to 2009, he was also co-chair of the Paris Club of official creditors.

European Central Bank

In late November 2011, Cœuré was nominated to the ECB executive board to replace Italy’s Lorenzo Bini Smaghi. He was, in a respect, a replacement for former ECB President Jean-Claude Trichet on the six-member board. France had reportedly insisted, as a condition for approving Italian Mario Draghi as Trichet's replacement earlier in the year, on Bini Smaghi's early resignation so a new French member could be appointed.^[2] In confirmation hearings in December, in line with a position already stated by Draghi, Cœuré said the bank maybe would have to increase its purchases of member-country sovereign debt as part of the effort to combat the European sovereign debt crisis.^[3] He stated, however, that any increase in bond buying, would have to obey the ECB’s primary goal of ensuring price stability. He was confirmed in mid-December^[4] and began his term on 1 January 2012.

Cœuré was named to manage ECB market operations as of March 2012, succeeding José Manuel González Paramo, as well as payment systems and market infrastructures, and economic research.^[5]

Cœuré is a supporter of the monetary policy of the ECB, which includes the use of unconventional measures. He repeatedly noted that the economic situation since the outbreak of the crisis warrants low ECB interest rates.^[6] He warned, however, that the monetary policy response of the ECB to the crises carries risks. It shields, he says, governments and other market participants from the disciplinary force of the markets and could make it easier for them to postpone painful reform.^[7][8]

He urged governments not to be complacent, because the rates won’t stay that low forever. “With our decisions we gave them time. It is important that they use this time and prepare themselves and become more resilient”.^[9] Already in 2005 he had called for structural reforms and a more sustainable fiscal policy in Europe.^[10]

Cœuré argued that central banks actions can generate moral hazard in the banking system and risk. He warned that “support that is considered as appropriate during the crisis might have perverse effects on the incentives of banks at a later stage.^[11]” He also argued in favour of a strict separation between the monetary policy and bank supervision functions of the ECB ^[12]

He supported the controversial decision on OMTs (Outright Monetary Transactions), but was in strong favor of the introduced conditionalities to mitigate negative side effects.^[13] He argued that “under OMTs, governments will have to continue their reform efforts as required by the respective ESM programme and by IMF involvement. Otherwise, they would simply become ineligible for OMTs. Hence, no reforms, no OMTs.".^[14] Therefore, he is perceived in the market to be more on the hawkish side of the Governing Council of the ECB.^[15]

Together with his German ECB colleague Jörg Asmussen, Cœuré supported the publication of the minutes of monthly ECB meetings.^[16]

In September 2013 he was appointed Chair of the Bank for International Settlements’ Committee on Payment and Settlement Systems,^[17] a standard setting body for payment, clearing and securities settlement systems.

In May 2015, in an evening non-public speech with simultaneous release added but then delayed due to "an internal procedural error" at ECB, Cœuré apparently moved markets the next day in the Euro currency and European stocks and bonds with the announcement that the bank's bond-buying program would be "moderately front-load[ed]" before the summer trading lull. The speech was originally scheduled to take place under the so-called Chatham House Rule^[18][19] or "rules". In the days after the Cœuré speech the ECB "declined to comment about its use of Chatham House rules" for the 18 May speech or about its other recent invocations of the rules.^[20]

Speeches

• "Central banks and the challenges of the zero lower bound", at meeting hosted by the Initiative on Global Markets (University of Chicago Booth School of Business), Miami, 19 February 2012; at ECB website. Via Ralph Atkins, "Cœuré, the ECB and zero interest rates", ft.com blog, 24 February 2012.
• "The monetary policy of the European Central Bank", at Barclays’ European Conference, Tokyo, 26 March 2012. Via Bank for International Settlements web site.
• "Why the euro needs a banking union", Frankfurt am Main, 8 October 2012.
• "Reviving credit growth in the euro area", at the Paris Europlace International Financial Forum “Growth and Investment Opportunities in Europe” in Paris, France; 11 July 2013

• (9 September 2014): Learning about negative interest rates

• (14 November 2014): The global and European aspects of policy coordination

• (2 February 2015): Lamfalussy was right: independence and interdependence in a monetary union (remark: Alexandre Lamfalussy (* 1929))

• (18 May 2015): How binding is the zero lower bound?; delivered at the conference “Removing the zero lower bound on interest rates”, organised by Imperial College Business School / Brevan Howard Centre for Financial Analysis, CEPR and the Swiss National Bank.

References

1. "Benoit Coeuré". European Central Bank. Retrieved 2013-11-29.
2. Deen, Mark, and Alan Katz, "France Nominates Treasury Official Benoit Coeure for ECB’s Executive Board", Bloomberg, November 25, 2011. Retrieved 2012-01-12.
3. Deen, Mark, and Jonathan Stearns, "France’s Coeure Says ECB May Have to Step Up Its Sovereign Bond Purchases", Bloomberg, December 13, 2011. Retrieved 2012-01-12.
4. "New E.C.B. Official May Be Open to Bond-Buying", NYTimes.com, December 15, 2011. Retrieved via topsy.com 2012-04-10.
5. "ECB confirms Belgian Praet receives economics portfolio", Reuters, January 3, 2012. Retrieved 2012-04-10.
6. "ECB's Coeure : Crisis to Blame for Low Rates, not ECB -Report",4-traders, November 11, 2013.
7. "ECB’s Coeure says low interest rates risk delay of reforms", forexlive, July 11, 2013.
8. "Reviving credit growth in the euro area", July 11, 2013
9. "Joint interview of Benoît Cœuré, Member of the Executive Board of the ECB, and Joachim Nagel, Member of the Executive Board of the Deutsche Bundesbank, conducted by Mark Schrörs of Börsen-Zeitung on 12 September 2013 and published on 18 September 2013"
10. "Fiscal Policy in Emu: Towards a Sustainability and Growth Pact?", "Oxford Review of Economic Policy vol. 21", 2005
11. "ECB Liquidity Can’t Be Capital Lack Substitute: Coeure", "Bloomberg", October 3, 2013.
12. "Symposium: “Central Banking: Where Are We Headed?” in honour of Stefan Gerlach’s contribution to the Institute for Monetary and Financial Stability", February 7, 2013.
13. "Outright Monetary Transactions, one year on", September 2, 2013.
14. "ECB Coeure: OMT A Monetary Policy Necessity ECB Is Prepared To Use", "eFXnews", September 2, 2013
15. "ECB Reference Guide", "Credit Suisse"
16. "Zentralbanker: EZB soll Protokolle veröffentlichen", Focus, July 20, 2013
17. "Committee on Payments and Market Infrastructures (CPMI)", bis.org, updated 13 May 2015.
18. Buell, Todd, and Josie Cox, "ECB to Front-Load on Bond Purchases Ahead of Summer Liquidity Lull" (photo included; access may be subscription)-required, Wall Street Journal, May 19, 2015. Retrieved 2015-05-19.
19. Spence, Peter, "Hedge funds got early access to information that prompted euro slide", The Telegraph, 19 May 2015. Retrieved 2015-05-26.
20. Fletcher, Laurence, with Todd Buell, "ECB error spurs questions about policy disclosures", MarketWatch, May 25, 2015. Retrieved 2015-05-26.