Attacks on Central bankers are ‘massive’ blame game: Carney
Bank of England Governor Mark Carney said yesterday that verbal attacks by politicians on central banks, such as criticism by US President-elect Donald Trump of the US Federal Reserve, were a “massive blame-deflection exercise”.
Carney has faced political criticism in Britain for the BoE’s low interest rates while Trump, during the US presidential election campaign, accused the Federal Reserve of keeping rates low due to pressure from the Obama administration. “The President-elect has voiced some views on the Fed and the stance of monetary policy,” Carney said in response to questions from lawmakers in parliament.
Carney said it was “very important” to explain that the causes of ultra-low interest rates in rich countries went far beyond decisions made by central bankers .”An excessive focus on monetary policy in many respects is a massive blame deflection exercise,” he said.
Carney has previously said interest rates are low because they reflect weaker demand and investment, a trend that has been developing since the 1980s due to factors such as the impact of technology and ageing populations. The BoE cut interest rates to a record low of 0.25 percent in August to help the British economy cope with the impact of the decision by voters to leave the European Union in June.
Also yesterday, Carney said he would not consider a further extension of his time in charge of the British central bank, which is now due to end in June 2019. “I will leave June 30, 2019,” Carney said in response to a question during a regular meeting with lawmakers in parliament.
The Canadian said on Oct. 31 that he will stay in his job for an extra year to help smooth Britain’s departure from the EU, but he will depart two years short of a full term.
Carney came under heavy criticism from pro-Brexit politicians for warning before June’s EU membership referendum of the economic risks of voting to leave the bloc.
Some British media have speculated that Carney might stay on beyond June 2019 if the government fails to conclude its exit from the EU by that date. Carney said his decision to extend his time at the BoE by only one year had nothing to do with comments made by British Prime Minister Theresa May who in October criticized the “bad side effects” of low interest rates. — Reuters