Reported Extension of BOE’s Mark Carney Tenure Backed By City Economists

    Advertisment
    Photo by Bank of England via Flickr

    Some economists in City have eagerly expressed their support for Mark Carney to extend his stay at the Bank of England following a report that was made by the Treasury. It had increased the prospect of an additional year with the governor.

    The term of Carney as the governor is scheduled to come to an end in June 2019, a year earlier as compared to the original plans. However, an extension of Carney’s term would provide some breathing space for his successor away from the immediate aftermath of Brexit that is scheduled in March 2019.

    According to the Evening Standard, the Treasury has introduced the possibility of Carney remaining in office for another year in order to provide a familiar face during a possibly turbulent transition post-Brexit. The Evening Standard is edited by George Osborne, a previous chancellor.

    The Treasury that is under Philip Hammond is assumed to be planning an all but identical process to the recruitment of Carney. A job advertisement was required to be published on the civil service jobs board. It was also required to be featured in the pages of the Economist magazine.

    The advert for the position of Carney went out in the September before the appointment. It was initiated by a small coterie that consists of top civil servants along with the chancellor.

    The current boss of the Financial Conduct Authority and former executive director at the Bank, Andrew Bailey, is the favourite for the position. Among the list of contenders, Shriti Vadera, the chairman of Santander US, and Raghuram Rajan, a respected economist from India, were included.

    However, continuity is likely the preferred route for the City.

    The senior economist at Hermes Investment Management, Silvia Dall’Angelo, stated: “It would be ideal if Carney decided to remain at the helm of the Bank of England for longer.

    She added: “It would provide continuity in the approach to monetary policy, shoring up business and consumer sentiment during the Brexit process and potentially allowing for a smoother transition.”

    However, she also said that it may be an “unpalatable offer,” given the acrimonious political atmosphere that surrounds the Brexit process. Carney has already been slammed with criticisms from politicians who support Brexit including Jacob Rees Mogg.

    A Treasury spokesperson stated: “We will begin recruitment for the next governor of the Bank of England in due course.”