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Israel central bank chief to step down

JERUSALEM – The governor of Israel’s central bank, credited with steering the nation’s economy safely through years of world financial turmoil, resigned Tuesday.

Stanley Fischer did not give a reason for his decision. In a brief statement, the Bank of Israel said Fischer informed Prime Minister Benjamin Netanyahu that he will step down on June 30.

Fischer, an internationally respected economist, served as deputy director of the International Monetary Fund and held a top post at Citigroup Corp. before taking over Israel’s central bank in 2005.

His monetary policies and Israel’s tight control of its banks are seen responsible for the nation’s stability despite the worldwide economic crisis that hit during his reign. Israel’s economy continues to grow, and unemployment is roughly 6 percent, relatively low in world terms.

His departure comes two years before the end of his second five-year term.

In a statement, Netanyahu praised Fischer and thanked him for his service.

“Professor Stanley Fischer played a major role in the economic growth of the state of Israel and in the achievements of the Israeli economy,” he said. “His experience, his wisdom and his international connections opened a door to the economies of the world and assisted the Israeli economy in reaching many achievements, during a period of global economic crisis.”

Fischer, 69, was born in North Rhodesia, now Zambia, and educated at the London School of Economics and Massachusetts Institute of Technology. He served as the thesis adviser to U.S. Federal Reserve Chairman Ben Bernanke at MIT in the 1970s.

At the IMF, he worked on resolving financial crises in Mexico, Russia, and Southeast Asia during the 1990s.

In Israel, Fischer has been credited with moving early to cut interest rates and intervening in the currency market to protect the local export sector.

With the economy improving in 2009, Israel began raising interest rates, making it the first nation to take such a step toward post-recession stabilization. He was also instrumental in promoting Israel’s successful bid for acceptance into the Organization for Economic Cooperation and Development, a grouping of 30 of the world’s richest nations.

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