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Iceland Central Bank Gets New Governor Amid Recession Warnings

  • Economics Professor Jonsson takes over amid a rate-cut cycle
  • Iceland is lowering interest rates to tackle economic downturn
Asgeir Jonsson
Asgeir JonssonPhotographer: Frank Augstein/AP Photo
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Asgeir Jonsson, an economist who did his PhD at Indiana University and is now the dean of the University of Iceland’s economics faculty, will become the island’s new central bank governor as 65-year-old Mar Gudmundsson steps down.

The 49-year-old takes over as Iceland grapples with the prospect of a recession driven by a sudden loss of tourism revenue. That’s already forced the central bank to start cutting interest rates in an effort to shield Icelanders from an economic shock. Meanwhile, central bank policy will also need to ensure a stable exchange rate as Iceland re-acquaints itself with markets after almost a decade of capital controls brought on by its 2008 economic collapse.