New Bank of England Governor urged to ‘keep economy steady’ through Brexit process
The next Governor of the Bank of England has been revealed today – and Andrew Bailey will take up the office amid calls to ‘keep the economy steady’ as Brexit looms.
Bailey will take over from current Governor Mark Carney on March 16 after being rated as ‘the standout candidate’ from a tough field of applicants.
Chancellor Sajid Javid announced the appointment this morning, and said: “When we launched this process, we said we were looking for a leader of international standing with expertise across monetary, economic and regulatory matters. In Andrew Bailey that is who we have appointed.
“Andrew was the stand-out candidate in a competitive field. He is the right person to lead the Bank as we forge a new future outside the EU and level-up opportunity across the country.
“I also want to take this opportunity to thank Mark Carney for his service as Governor. The intellect, rigour and leadership he brought to the role during a critical time was a significant contribution to the UK economy moving to recovery and growth.”
Accepting the role, Andrew Bailey said: “It is a tremendous honour to be chosen as Governor of the Bank of England and to have the opportunity to serve the people of the United Kingdom, particularly at such a critical time for the nation as we leave the European Union.
“The Bank has a very important job and, as Governor, I will continue the work that Mark Carney has done to ensure that it has the public interest at the heart of everything it does.
“It is important to me that the Bank continues to work for the public by maintaining monetary and financial stability and ensuring that financial institutions are safe and sound.”
Outgoing Governor Mark Carney paid tribute to his successor.
He said: “An extraordinary public servant, Andrew brings unparalleled experience, built over three decades of dedicated service across all policy areas of the Bank, and most recently as CEO of the FCA.
“Andrew is widely and deeply respected for his leadership managing the financial crisis, developing the new regulatory frameworks, and supporting financial innovation to better serve UK households and businesses.
“Over the years, I benefited greatly from his support and wise counsel. I wish Andrew and the Bank continued success in their work to serve the people of the United Kingdom by maintaining monetary and financial stability.”
The appointment comes 24 hours after the Bank of England confirmed its intention to maintain interest rates at 0.75%.
The decision was made amid expectation that the UK economy will pick up from its current ‘weak’ position as greater certainty on Brexit evolves.
It said household spending had grown steadily during the past quarter, but business investment had remained weak due to uncertainty over Brexit and the general election.
Dr Kerstin Braun, President of international trade finance company Stenn Group, called upon the Bank to keep the economy steady and urged businesses to invest to kickstart a post-Brexit recvoery.
Dr Braun said: “Boris Johnson’s win provides the much-needed solidity the UK has been craving. Businesses can begin to see their future and now Brexit is confirmed to go ahead, The Bank of England needs to keep the economy steady as we navigate Britain’s exit from the EU.
“But a prolonged period of low growth, low inflation, and low interest rates will limit the Bank’s ability to create stimulus when needed.
“It’s unlikely trade will be decided until the end of 2020 so it’s vital UK firms start investing again as they exit Brexit limbo. This is critical for long-term growth.
“With Europe mired in low growth and a modest global economic outlook for 2020, global demand will be weak as companies rev up their engines. The recovery will be slow, with GDP growth estimated to be 1% in 2020.
“The UK economy has been flatlining this year, but the pound surged to its largest amount in a decade after a clear majority was announced, and it’s expected Sterling could rally next year to a pre-referendum level of $1.45.
“We expect consumer spending to pick up gradually, but with elevated levels of household debt, the consumer can’t keep the economy afloat forever. Unemployment is down but wages aren’t keeping pace.”