Benoît Cœuré Explained

Benoît Cœuré
Office:President of Autorité de la concurrence
Term Start:20 January 2022
Predecessor:Isabelle de Silva
Office2:Member of the Executive Board of the European Central Bank
Term Start2:1 January 2012
Term End2:31 December 2019
Predecessor2:Lorenzo Bini Smaghi
Successor2:Fabio Panetta
Birth Date:17 March 1969
Birth Place:Grenoble, France
Education:École Polytechnique

Benoît Georges Cœuré (in French bənwa kœʁe/; born 17 March 1969[1]) is a French economist who has been serving as President of the Autorité de la concurence since 2022. He previously served as a member of the Executive Board of the European Central Bank from 2012 to 2019.

Education

Benoît Cœuré graduated from Ecole Polytechnique (X 1987) and the National School of Statistics and Economic Administration (Ensae). He also holds a Master of Advanced Studies (DEA) in economic analysis and policy from the School for Advanced Studies in the Social Sciences (EHESS) and a B.A. in Japanese from University Paris 7.

Early career

Cœuré taught economics at l'Ecole Polytechnique[1] and was chief economist, No. 2 official, head of multilateral affairs and development, and head of France’s debt-management office in the country's finance ministry.

From 2007 to 2009, Cœuré was also co-chair of the Paris Club of official creditors. In addition, he co-chaired the G20 Working Group on Reforming the World Bank and the Other Multilateral Development Banks (2009) and of the G20 Sub-Working Group on Global Liquidity Management (2011).

European Central Bank (2012–2019)

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 8-year 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 for a brief period of time, IT and economic research.[5] He was in charge of international relations and European affairs from 2014, when his German colleague Jörg Asmussen left the ECB,  until 2019. In this capacity, he was a member of the EU Economic and Financial Committee and Euro Working Group and took part in negotiations on financial support to Ireland, Portugal, Cyprus and Greece.

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] He argued repeatedly that for the euro area to be resilient, it would need three lines of defence:[11] flexible and integrated markets, sound national fiscal policies, and a common fiscal capacity.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.[12] ” He also argued in favour of the ECB being tasked with banking supervision, but with a strict separation between the monetary policy and bank supervision functions of the ECB [13]

He supported the controversial decision on OMTs (Outright Monetary Transactions), but was in strong favor of the introduced conditionalities to mitigate negative side effects.[14] 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.".[15] Therefore, he was perceived in the market to be more on the hawkish side of the Governing Council of the ECB.[16]

Together with his German ECB colleague Jörg Asmussen, Cœuré supported the publication of the minutes of monthly ECB meetings.[17] In a speech delivered in November 2018,[18] he also pioneered the discussion on the role of monetary for climate change[19] and he openly criticized the use of output gap calculation in EU macroeconomic policy.[20]

In his farewell speech from the ECB,[21] in December 2019, he argued against overreliance in capital markets to transmit monetary policy, and concluded that “If monetary policy remains a conversation between central banks and financial markets, we shouldn’t be surprised if people don’t trust us.”

In October 2013 Cœuré was appointed chair of the Bank for International SettlementsCommittee on Payment and Settlement Systems,[22] a standard setting body for payment, clearing and securities settlement systems, which he headed for six years. In 2014, the Committee became the Committee on Payments and Market Infrastructures (CPMI). Under his direction, the Committee tackled different topics, such as the resilience and recovery of central counterparties,[23] cyber resilience for financial market infrastructures,[24] and the emergence of crypto assets and tech giants in financial services. The CPMI published the first international report on central bank digital currencies in 2018.[25]

In 2019, Cœuré chaired a Group of Seven working group on global stablecoins.[26] In early 2019, a Reuters poll of economists found that Cœuré was considered best-suited for the role as President of the European Central Bank, but Christine Lagarde was eventually nominated for the position.

Career post-ECB

Bank for International Settlements

In November 2019, Cœuré was appointed by the board of directors of the Bank for International Settlements (BIS) as Head of the new BIS Innovation Hub, established to foster international collaboration among central banks on innovative financial technology.[27] [28] In 2020–21, the BIS Innovation Hub was deployed in Hong Kong, Singapore, Switzerland, London and Stockholm in partnership with local central banks, and built a portfolio of proofs of concept and prototypes across five strategic themes: central bank digital currency, next generation financial market infrastructures, open finance, regtech and suptech, cybersecurity, and green finance.[29] Between 2020 and 2021, Cœuré co-chaired with Bank of England Deputy Governor Sir Jon Cunliffe a working group on central bank digital currency (CBDC) set up by seven central banks and the BIS, which published in September 2021 reports on user needs and adoption, system design and interoperability and financial stability implications.[30] He warned against regulation of digital assets and decentralised finance being developed along different tracks and urged discussions on a global regulatory framework.[31]

Autorité de la concurrence

In 2021, the French government proposed Cœuré to succeed Isabelle de Silva as the new head of the Autorité de la concurrence, the French antitrust agency.[32] On 13 January 2022, after being heard by the Senate and the National Assembly, his appointment was confirmed.[33] [34] He took office on 22 January 2022 for a five-year term.

Controversy

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.[35] [36]

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 rule.[37] In a letter to the European Ombudsman,[38] Emily O’Reilly, ECB’s President, Mario Draghi, clarified the circumstances of the incident and noted that it resulted from internal miscommunication at an operational level on the timing of the speech’s publication, which took place out-of-office hours.[39] The Ombudsman welcomed the transparency steps taken by ECB to prevent any other similar incident.[40]

Other activities

Government agencies

Non-profit organizations

University and Research Centres

Speeches

Notes and References

  1. Web site: Benoit Coeuré. dead. https://web.archive.org/web/20131204101751/http://www.ecb.europa.eu/ecb/orga/decisions/html/cvcoeure.en.html. 4 December 2013. European Central Bank. 29 November 2013.
  2. News: Deen. Mark. Katz. Alan. 25 November 2011. France Nominates Treasury's Coeure for ECB Executive Board. Bloomberg News. 12 January 2012. https://web.archive.org/web/20160307210617/https://www.bloomberg.com/news/articles/2011-11-24/france-nominates-benoit-coeure-for-ecb-board. 7 March 2016.
  3. News: Deen. Mark. Stearns. Jonathan. 13 December 2011. France's Coeure Says ECB May Have to Step Up Bond Buying. Bloomberg News. 12 January 2012. https://web.archive.org/web/20160308041141/https://www.bloomberg.com/news/articles/2011-12-12/france-s-coeure-says-ecb-may-have-to-step-up-its-sovereign-bond-purchases. 8 March 2016.
  4. https://www.nytimes.com/2011/12/15/business/global/new-ecb-official-may-be-open-to-bond-buying.html "New E.C.B. Official May Be Open to Bond-Buying"
  5. http://uk.reuters.com/article/uk-ecb-board-praet-idUKTRE8020T820120103 "ECB confirms Belgian Praet receives economics portfolio"
  6. http://www.4-traders.com/news/ECBs-Coeure--Crisis-to-Blame-for-Low-Rates-not-ECB-Report--17449408/ "ECB's Coeure : Crisis to Blame for Low Rates, not ECB -Report"
  7. http://www.forexlive.com/blog/2013/07/11/ecbs-coeure-says-low-interest-rates-risk-delay-of-reforms/ "ECB’s Coeure says low interest rates risk delay of reforms"
  8. http://www.ecb.europa.eu/press/key/date/2013/html/sp130711.en.html "Reviving credit growth in the euro area"
  9. Web site: Interview with Börsen-Zeitung. 18 September 2013. European Central Bank.
  10. https://web.archive.org/web/20120111082815/http://oxrep.oxfordjournals.org/content/21/4/598.short "Fiscal Policy in Emu: Towards a Sustainability and Growth Pact?"
  11. Web site: The euro area's three lines of defence . 2 February 2018 .
  12. https://www.bloomberg.com/news/2013-10-03/coeure-says-ecb-liquidity-can-t-be-substitute-for-capital-lack.html "ECB Liquidity Can’t Be Capital Lack Substitute: Coeure"
  13. http://www.ecb.europa.eu/press/key/date/2013/html/sp130207.en.html "Symposium: “Central Banking: Where Are We Headed?” in honour of Stefan Gerlach’s contribution to the Institute for Monetary and Financial Stability"
  14. http://www.ecb.europa.eu/press/key/date/2013/html/sp130902.en.html "Outright Monetary Transactions, one year on"
  15. http://www.efxnews.com/story/20501/ecb-coeure-omt-monetary-policy-necessity-ecb-prepared-use "ECB Coeure: OMT A Monetary Policy Necessity ECB Is Prepared To Use"
  16. https://doc.research-and-analytics.csfb.com/docView?language=ENG&source=emfromsendlink&format=PDF&document_id=930461241&serialid=oY13jbCzrfb1w1t%2FVsDTaBDU9vmF2bzf14lled4mR8Y%3D "ECB Reference Guide"
  17. http://www.focus.de/finanzen/banken/joerg-asmussen-und-franzoesischer-kollege-benoit-coeure-zentralbanker-ezb-soll-protokolle-veroeffentlichen_aid_1056399.html "Zentralbanker: EZB soll Protokolle veröffentlichen"
  18. Web site: Monetary policy and climate change. Coeuré. Benoit. 8 November 2018. European Central Bank. en. 9 November 2019.
  19. News: Cœuré addresses criticism over ECB's green finance efforts. Jones. Claire. November 2018. Financial Times. en-GB. 9 November 2019.
  20. "True, the output gap is an elusive concept that should never have become a gauge for conducting public policy, and it may be larger than thought.", Monetary policy: lifting the veil of effectivenes, Speech by Benoit Cœuré, 18 December 2019
  21. Web site: 18 December 2019 . Speech by Benoît Cœuré, Member of the Executive Board of the ECB, at the ECB colloquium on "Monetary policy: the challenges ahead" held in his honour . Bank . European Central .
  22. http://www.bis.org/cpmi/info.htm?m=3%7C16%7C29 "About the Committee on Payments and Market Infrastructures (CPMI)"
  23. Web site: August 2016 . Resilience and recovery of central counterparties (CCPs): Further guidance on the PFMI .
  24. Web site: 29 June 2016 . CPMI-IOSCO release guidance on cyber resilience for financial market infrastructures .
  25. Web site: 12 March 2018 . Central bank digital currencies .
  26. Web site: 18 October 2019 . Investigating the impact of global stablecoins .
  27. https://www.bis.org/press/p191111.htm Benoît Cœuré appointed to head BIS Innovation Hub
  28. Balazs Koranyi (11 November 2019), ECB's Coeure to head BIS Innovation Hub from Jan. 15 Reuters.
  29. Web site: BIS Innovation Hub work programme.
  30. Web site: 30 September 2021 . Central bank digital currencies – executive summary .
  31. News: 18 December 2021 . "Benoît Cœuré says regulators likely to agree crypto framework in 2022" . .
  32. Sandra Auger and Leigh Thomas (16 December 2021), French antitrust watchdog -Elysee Reuters.
  33. Web site: Demande de vidéos - Vidéos de l'Assemblée nationale. videos.assemblee-nationale.fr.
  34. Web site: Audition de M. Benoît Coeuré, candidat proposé par le Président de la République aux fonctions de président de l'Autorité de la concurrence. videos.senat.fr.
  35. Buell, Todd, and Josie Cox, "ECB to Front-Load on Bond Purchases Ahead of Summer Liquidity Lull" (photo included; access may be subscription)-required, The Wall Street Journal, 19 May 2015. Retrieved 19 May 2015.
  36. Spence, Peter, "Hedge funds got early access to information that prompted euro slide", The Telegraph, 19 May 2015. Retrieved 26 May 2015.
  37. Fletcher, Laurence, with Todd Buell, "ECB error spurs questions about policy disclosures", MarketWatch, 25 May 2015. Retrieved 26 May 2015.
  38. Web site: 10 June 2015 . Reply from the President of the European Central Bank to the Ombudsman's letter concerning a speech delivered by a member of the ECB Executive Board on 18 May 2015 .
  39. News: 22 January 2021 . "ECB to review format of private calls by chief economist to investors" . .
  40. Web site: 3 December 2015 . Ombudsman welcomes further transparency steps by ECB .
  41. http://www3.weforum.org/docs/WEF_Policy_Group_Members.pdf?ET_CID=2199827&ET_RID=001b000000npTqWAAU Europe Policy Group
  42. https://lecercledeseconomistes.fr/membres/ Members
  43. https://www.delorscentre.eu/en/about/advisory-board Advisory Board