Germany and France Near Deal on Next ECB President

Germany and France are close to finalising a deal about the leadership of the European Central Bank (ECB), the institution that manages money policy for the eurozone.

According to reports, Spain's Pablo Hernández de Cos has become the favourite to be the next ECB president.

German chancellor Friedrich Merz said he wants to close the agreement on the ECB's top positions next week. He added that some parts of the deal are already very close to being finished.

Hernández de Cos currently holds an important role in monetary policy, which refers to decisions about interest rates and the supply of money.

The ECB's leadership is usually agreed through negotiation between major EU countries, since the role affects the whole eurozone, the group of countries that use the euro currency.

This week, the European Union is expected to take a key step that could help unblock the process of choosing the next ECB president.

On Wednesday, EU representatives are set to discuss the matter, which could clear the way for a final decision on Hernández de Cos's candidacy.

The ECB plays a central role in managing inflation, which means the rate at which prices for goods and services rise over time.

Leadership changes at the ECB are closely watched by financial markets, since decisions by the bank affect interest rates, bank lending and the value of the euro across Europe.

While no official announcement has been made, the growing agreement between Germany and France suggests that a final decision may come soon.

Observers say that if confirmed, Hernández de Cos would bring experience from Spain's financial sector to one of the most powerful institutions in Europe.