Professor Amir Yaron officially assumed the role of Bank of Israel governor on Monday, replacing Dr. Karnit Flug, after she decided not to pursue a second term in office.
President Reuven Rivlin, Prime Minister Benjamin Netanyahu, Finance Minister Moshe Kahlon and other top officials attended Yaron's induction ceremony at the President's Residence in Jerusalem.
"This is a great day for the Israeli economy and for the Bank of Israel," Netanyahu said at the ceremony.
He said the central bank chief had to be "independent and free of any pressure by any element," but still was required to develop "close cooperation and consultations" with government officials.
"I would like to thank Professor Yaron for accepting this position. The finance minister and I carefully chose him [the man] for this position. We searched across Israel and all over the world for the most talented individual, going as far as Pennsylvania," Netanyahu said, referring to Yaron's most recent posting, as a professor of banking and finance at the Wharton School at the University of Pennsylvania.
"You have a reputation as one of the world's brightest minds in macroeconomics. I believe you are the right man in the right place, and the right place is the State of Israel, which you hold dear," Netanyahu said
He also expressed confidence that the Israeli economy would weather the recent downturn in world markets, saying, "The Israeli economy is robust and it generates added value. We do it all the time. Anyone with common sense should just let us power forward."
Netanyahu said the new central bank chief faces two related tasks: first, to increase competition in the banking sector, and second, to usher Israel into a new era of technologies that will enable better access to credit, something he said "should be accessible to everyone."
Rivlin said that Yaron's past postings "indicate that you are the right person for the job at this time."
"We are on the brink of an economically challenging period and I am sure that cooler heads will continue to steer us through these troubled waters," Riuvlin said.
"Israel's macroeconomic strength is phenomenal. The unemployment rate is low, the currency is strong and inflation is low, and in just 70 years, Israel has positioned itself as a leader in many areas.
"There are also great challenges ahead. The first challenge is to address the socio-economic gaps in Israel, and the second is to ensure that the middle class lives with dignity. The cost of living is high and there is an overall feeling that too many Israelis have been forgotten.
"The coming year is an election year and the Bank of Israel must listen to the people, weigh the facts and figures, and maintain stability. It won't be easy, but we believe you have what it takes to maintain the strength of the Israeli economy," Rivlin said.
Kahlon also said he was confident Yaron was up to the challenges.
"We have a responsibility to continue bolstering the economy, which is now stronger than ever, and I am certain that you will be able to maintain your independence when leading the Bank of Israel. We have to think about how we can promote the economy further and encourage growth. That is where our future lies," Kahlon said.
Yaron thanked Rivlin, Netanyahu and Kahlon, saying, "Being named Bank of Israel governor is a great honor."
His first order of business will be to decide whether to increase key interest rates on Jan. 7.
