It’s not just bank CEOs and hedge fund managers that have a major impact on the financial markets. Political leaders and heads of state also wield tremendous power in the world of finance, influencing everything from interest rates to trade and all the way up to geopolitics. Below is a list of some of the most powerful financial influencers of 2016.
No list of most powerful leaders in finance would be complete without the Chair of the Federal Reserve. Since 2014, Janet Yellen has headed the world’s most powerful central bank. Her influence is easy enough to understand: she heads the institute that controls the size and growth rate of the US money supply. To say that financial market participants hang on her every word would be a huge understatement.
Jian Jianqing may not be as well-known as Janet Yellen, but he can be just as influential. The 62-year old heads the Industrial and Commercial Bank of China, the world’s largest commercial bank with a staggering $3.5 trillion in assets. Jiang plays a major role in the world’s second largest economy and just so happens to be in the Communist Party’s Central Committee.
Financial market participants have grown very familiar with Mario Draghi, who heads the European Central Bank (ECB). Draghi influences monetary policy in the 19-member Eurozone and has been an influential figure in the central bank’s massive stimulus program. Like Yellen, Draghi regularly hogs the spotlight, and his press conferences are followed by millions of people around the world.
Christine Lagarde was appointed managing director of the International Monetary Fund (IMF) in 2011. The IMF, an international lending institution representing 188 countries, controls vast resources. Traders became very familiar with the institution during the Greek debt crisis. As part of the “troika” of Greek lenders, the IMF has carved out Athens’ bailout terms. For that reason, it’s not very popular in the Hellenic republic.
The charismatic leader of the Russian Federation has assumed a bigger role on the world stage, and today wields tremendous economic and financial power. Forbes has named Vladimir Putin the world’s most powerful man in back-to-back years. It’s not difficult to see why. He seized Crimea from Ukraine, aided Syrian President Bashar al-Assad in pushing back ISIS and implemented sanctions against Turkey that may have isolated Ankara just enough for it to issue an apology for shooting down a Russian fighter jet last November.
Angela Merkel is the Chancellor of Germany, Europe’s biggest economy and one of the world’s major manufacturing stalwarts. Although Merkel has come under fire for her position on Europe’s refugee crisis, Merkel remains one of region’s most indispensable leaders. She was an important figure in brokering financial compromises between Greece and the troika, and is also set to play an important role in fostering common ground in the upcoming Brexit negotiations.
The growing influence of central banks on the financial world can be observed merely by observing the market’s response to central bankers themselves. Haruhiko Kuroda is Governor of the Bank of Japan (BOJ), and like his colleagues at the Fed and ECB, has a major impact on the markets. Kuroda is responsible for setting Japan’s monetary policy. This also entails giving press conferences and making speeches that explain the central bank’s policy position. Suffice it to say, Kuroda is one of the most closely followed personalities in the global financial markets.
BONUS: David Davis
David who? David Davis is the United Kingdom’s recently appointed Secretary of State for Exiting the European Union. In the wake of Britain’s decision to leave the EU, Davis is expected to play a major role in negotiating a new trade deal between London and Brussels. Whether he likes it or not, the financial markets will be closely following Davis’ every word. Given what’s at stake, Davis’ performance could dictate whether other European countries follow Britain’s example and push for independence from Brussels.
A word should also be said about Theresa May, the UK’s newly appointed Prime Minister. May’s administration will be tasked with seeing through the Brexit camp’s ambitions of a more independent UK that remains economically tied to the rest of Europe. Negotiations are expected to be tumultuous and should elevate UK officials into the limelight over the next two years.
 Forbes. The World’s Most Powerful People: Vladimir Putin.
 Sarah Rainsford (July 2, 2016). “After Erdogan apology, Russia brings Turkey in from the cold.” BBC News.
 Seema Mody (November 23, 2015). “Angela Merkel: German leader sees political influence slip.” CNBC.
Article by Nikolas Xenofontos, Director of Risk Management at easyMarkets (www.easymarkets.com).