The centre-right Republican mayor of Le Havre, and a parliamentary deputy, Mr Philippe brings crucial political balance for a president whose own roots are on the left, and who promised to govern from the centre.
Macron is seeking to attract members from both the right and left to his new political party, La République en Marche (Republic on the Move), in time for next month's parliamentary elections.
The divide-and-conquer tactics by the centrist Macron, elected on May 7, are spreading alarm in the Socialist party and the conservative Republicans (LR), both of which are still licking their wounds after their presidential defeat.
Like Macron, Philippe is a product of France s elite ENA college for senior public servants and worked for a while in the private sector.
Speaking last Thursday, Philippe encouraged Macron to "transgress" by naming someone from outside his party which he hinted would encourage some of his colleagues to join the REM.
Macron has said such measures would allow for joint investments and help the eurozone better cope with financial crises.
Macron's presidential rival, Marine Le Pen, the leader of the National Front party, who lost to him in the second round of the election, said in a statement that the nomination was not a surprise.
In a nod to German concerns, Macron said at the news conference with Merkel that he had never pushed for jointly issued eurobonds and doesn't favor European countries taking joint responsibility for old debts.
The newly appointed prime minister will have to reveal his government by Tuesday.
In Berlin, Macron declined to answer a question about his new prime minister, only saying the choice of Philippe is part of the new political landscape he's promoting.
He has been Mayor of Le Havre since 2010.
Professor Anand Menon, the director of research initiative United Kingdom in a Changing Europe, warned Marine Le Pen would "be back in 2022" if the French President fails to reform France and build its economy.
He concluded his brief telegram by invoking the Lord's blessing on President Macron and on all the inhabitants of France.
In this way, the new president will try to reduce the gaps between the French right and left, who have dominated French politics for decades, through the Republican support that may contract the appointment of the new Prime Minister.
"It is in Germany's interest for Emmanuel Macron to succeed", stressed Seibert.
Germany's finance minister, WolfgangSchaeuble, is keen to have more control on the Eurozone's bailout fund, but Macron is instead pushing for a common Eurozone budget and a Eurozone finance minister. It is traditional for French leaders to make Berlin their first European stop. European leaders were visibly relieved, and rightly so, as a Le Pen win would have presented a deep and immediate challenge to the future of the European Union.
Finance Minister Wolfgang Schaeuble had warned that such deep-reaching reforms would require European Union treaty changes, which were "not realistic" at a time when Europe was hit by a surge of anti-euro populism.
"He has the advantage of being completely unknown to the average French person", political analyst Chloe Morin of the Jean-Jaures Foundation, a left-leaning think-tank, told AFP.
"There will be no arm-wrestling", she said.
Emmanuel Macron's support for the Paris bid is seen as symbolically important, and his decision to meet Tuesday with the visiting International Olympic Committee delegation was one of his first moves since taking office Sunday.
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