Mitja Gaspari

Ralph Atkins

The battle hots up. Luxembourg has challenged Spain’s self-proclaimed right to a place in the European Central Bank’s top management team. The Grand Duchy on Friday announced it would nominate Yves Mersch, the country’s central bank governor, for the upcoming vacancy on the ECB’s six-man executive board.

As Money Supply reported earlier this week, Madrid has already nominated Antonio Sáinz de Vicuña, a Spanish ECB veteran who heads its legal department, to replace José Manuel González-Páramo, his compatriot , whose eight-year term on the executive board ends in May.

The contest may prove an unwelcome distraction as eurozone leaders seek to combat the region’s debt crisis. But this could be a battle fought at the highest level.