Wanted: New Central Bank Chief. Expertise and Political Acumen Required.

The economy was languishing when Christine Lagarde took the lead of the European Central Bank in late 2019.Inflation in Europe was too low, growth was slowing and interest rates were negative.

There were problems, but none were flashing red.Then the first crisis arrived within about three months — the Covid-19 pandemic.From there, Ms.

Lagarde has steered Europe’s economy through the energy shock after Russia’s 2022 invasion of Ukraine, the turmoil raised by President Trump’s global tariffs last year and another energy shock from the war in the Middle East.After more than seven years of putting out fires, Ms.Lagarde will hand over the reins in February, she announced this week.

The process to choose her successor has already begun.“Given the fact that we went from one crisis to the other, the central bank needs to be pragmatic and flexible,” said Frederik Ducrozet, head of strategy and macro research at Pictet Wealth Management.“And this has been the story of the E.C.B.”Economists warn that the world is likely to face more acute shocks, which policymakers around the globe will have to grapple with alongside seismic changes from climate change and artificial intelligence.

Through it all, the main job of the head of the central bank sounds deceptively simple: Keep prices stable.For the most part, that means ensuring that inflation is about 2 percent.At the European Central Bank, the task is more difficult because it aims to keep inflation steady across 21 countries.

Among European institutions, the bank is rare for its truly Pan-European focus.Policies are set by the six members of the bank’s executive board, which includes the president, and the governor from the central bank of each euro country.

But they target average inflation across the eurozone, not in their individual home countries.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.If...