TEL AVIV (Reuters) - Yair Lapid, a former TV anchor whose upstart political party was the biggest surprise in Israel's election, was named the country's new finance minister on Friday as a government coalition deal was signed, his spokesman said.
Lapid's centrist Yesh Atid party won a more-than-expected 19 seats in the January 22 election, the second most behind Prime Minister Benjamin Netanyahu's right-wing Likud-Beiteinu alliance's 31 seats in the 120-member parliament.
After nearly six weeks of negotiations, Yesh Atid agreed on Thursday to join a Netanyahu-led governing coalition. The deal, and a separate alliance between Likud-Beiteinu and the far-right Jewish Home party, were signed on Friday.
Lapid, who will replace Yuval Steinitz once a new government is sworn in, ran largely on a platform of easing financial pressures on the middle class through the need to share the burden - a rejection of privileges for ultra-Orthodox Jews.
The new minister faces a major fiscal challenge in trying to reduce a budget deficit that reached 4.2 percent of gross domestic product in 2012, double an initial target of 2 percent.
Zach Herzog, head of international sales at brokerage Psagot Securities, said Lapid will have to prove to markets that he can manage fiscal policy.
"From what little can be gleaned about his economic views he will be fairly in line with centrist-right economic policy," Herzog said. "He will make cuts in social services, child benefits. That's part of the platform he ran on."
(Reporting by Tova Cohen and Steven Scheer; Editing by Robin Pomeroy)
