Bank’s next Governor should be British, says ex-rate setter
BANK OF England Governor Mark Carney has been savaged by a former interest rate-setter, who has accused the Canadian of “lacking confidence” and called for him to be replaced by a Brit.
Andrew Sentance, senior economic adviser at PwC and a former member of the Bank’s Monetary Policy Committee (MPC), told the Press Association the Treasury should not look overseas again as it begins compiling a shortlist of candidates to replace Mr Carney at the helm.
In an explosive critique of Mr Carney’s reign, Mr Sentance said the Governor’s “lack of confidence with raising interest rates has been due to the fact he’s not familiar with the UK economy”.
He added: “I don’t think we should appoint somebody else from overseas. I don’t think having people who aren’t familiar with the UK economy jetted in would be a good thing.”
Mr Carney’s term ends in June next year and the Treasury is expected to draw up the shortlist of potential successors this summer, with a decision set to be made around November.
The Canadian’s appointment in June 2013 saw him become the first foreign Governor at the Old Lady of Threadneedle Street, replacing Sir Mervyn King at the helm.
A Treasury source said the recruitment process for Mr Carney’s successor will be “open and fair”, adding that it will appoint the next Governor “purely on merit”.
Mr Sentance said Mr Carney’s tenure has been marred by a raft of missed opportunities to increase rates above 0.5 per cent, having languished at emergency lows for more than 10 years.
His comments come after the Bank backed away from raising rates once again last month following a sharp slowdown in growth. Mr Sentance said Mr Carney seems “very reluctant” to bring rates back to more normal levels, with just one rise last November, reversing a cut to 0.25 per cent after the Brexit vote.
He said the MPC have “missed several chances” to raise rates since the start of 2014 and now risks leaving the economy facing a “stagflation scenario”.
“We’re in danger of being in a position where high inflation and low growth are feeding off each other,” he cautioned.
He is backing internal favourite Andrew Bailey to be the next Governor.
I don’t think we should appoint somebody else from overseas. Andrew Sentance, a former member of the Bank of England’s Monetary Policy Committee.