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ive years ago, when Dr. Karnit Flug assumed her position as governor of the Bank of Israel, I asked Washington Post business journalist Neil Irwin what attribute Flug needed most to succeed.

“A spirit of modesty going forward,” he said.

Whether Flug heard him say it or not, she conducted herself with professionalism, modesty, and restraint during her five-year term, which ends in November, following her Erev Shabbos announcement that she will not seek a second term.

Flug had a tough act to follow, taking over for her mentor Stanley Fischer, who earned a reputation as the global economy’s foremost battlefield medic. Flug brought continuity to the Fischer era, keeping interest rates at rock-bottom while resisting considerable pressure from exporters to artificially weaken the shekel versus the dollar. Despite some fluctuations, the shekel dollar rate today of 3.60 is almost identical to where it stood in November 2013 when Flug took the job.

Yet that desire for stability often brought her into conflict with Finance Minister Moshe Kahlon, a maverick and reformer. The Bank of Israel issued a critique of Kahlon’s measures to lower Israeli housing costs, which the finance minister took personally. The two also clashed over Kahlon’s proposals to increase competition in the banking and credit card industries and whether to use Israel’s budget surplus to lower taxes (Kahlon) or to reduce the country’s debt (Flug).

Under Israeli law, Kahlon and Prime Minister Netanyahu jointly appoint Flug’s successor.

The temptation will be great, especially with elections coming up no later than October 2019, to make a populist pick who will aid the coalition’s reelection efforts.

Which is one reason in her parting letter Flug stipulated that the government must choose a replacement with enough backbone to ensure the Bank of Israel retains its independence from political considerations. (Originally featured in Mishpacha, Issue 718)