By Eliana Raszewski
BUENOS AIRES (Reuters) - Argentina's incoming central bank head, Miguel Angel Pesce, will need all his guile to navigate the country's myriad economic challenges: interest rates above 60%, drained foreign reserves, tough fiscal targets and roaring inflation.
The low-profile economist, most recently president of provincial Tierra del Fuego bank, has indicated he will seek to shift policy away from the more orthodox stance the bank has followed under conservative President Mauricio Macri, who hands over power on Dec. 10.
Pesce, 57, a former central bank vice president who led the bank temporarily in 2010 under then President Cristina Fernandez de Kirchner, has backed lowering interest rates and striking a "social pact" to help cool fast-rising prices.
"The orthodox approach to inflation is wrong. They are trying to contain inflation with monetary policy, monetary restriction and the interest rate - and this has not worked," Pesce said in September in a televised interview.
"It is important to have a social pact not only addressing the issue of income and salary increases, but also that there is an agreement not to increase prices," he added.
His brief spell leading the central bank came after the bank's president Martín Redrado resigned after refusing to implement an order from Peronist Fernandez de Kirchner to use foreign reserves to pay off mounting debt.
Pesce - who has chided Macri's administration for treating the central bank as a "sacred cow" - waved through Fernandez de Kirchner's request, prompting some to question his defense of central bank autonomy and independence.
He told Reuters this week that his choice in 2010 had been simply a matter of abiding by the book.
"I am a democrat and I do not question a constitutional order," said Pesce, who politically is part of a pro-Kirchner sector of the centrist Radical party, the party that is the traditional opposition to the Peronists.
Fernandez de Kirchner is returning to the Casa Rosada presidential palace as vice president alongside incoming President Alberto Fernandez.
An economics graduate from the University of Buenos Aires, Pesce faces challenges including annual inflation running above 50%, dwindling foreign reserves and a peso currency that has dropped sharply against the dollar since 2018.
A central bank official, who asked not to be named, said Pesce was not known as a natural 'policy maker' but would take a practical approach in the role.
"(Pesce) is a pragmatic man, who knows a lot about banks and tax issues," said the official.
Pesce and Fernandez de Kirchner are also being probed by federal prosecutors over accusations that future dollars were sold below market value during his tenure at the central bank.
Pesce has denied the allegations which he calls "crazy" and told Reuters the investigation was "absolutely political."