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Haskel appointment to MPC suggests easing rate rise pressure

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  • 01/06/2018
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Haskel appointment to MPC suggests easing rate rise pressure
The appointment of professor Jonathan Haskel to replace Ian McCafferty on the Bank of England’s (BoE) Monetary Policy Committee (MPC) suggests a softer path of interest rate raises, according to Oxford Economics.

 

Haskel, who is professor of economics at Imperial College Business School, was appointed yesterday to replace McCafferty in September and is expected to “shift the balance of the MPC in a more dovish direction”.

This means McCafferty, seen as an “arch hawk” in favour of quicker rate hikes, will remain in place for the key August meeting of the MPC, when it is expected to implement a further base rate rise following the late derailment of a rise in May.

“We still think it likely that McCafferty’s final meeting in August will see him form part of a rare majority for a rate hike,” Oxford Economics said.

“The committee has sent strong hints that it plans to move, if the data confirms that the Q1 weakness was a blip.”

Regarding the future economy and Haskel’s appointment, Oxford Economics added: “while we expect consumers to remain under the cosh, the chances of even greater pressure from a more aggressive path of monetary tightening appear to have receded a little with the latest appointment to the MPC”.

 

With this appointment, the full list of MPC members from 1 September 2018 will be:

Mark Carney (governor)

Ben Broadbent (deputy governor, monetary policy)

Sir David Ramsden (deputy governor, markets and banking)

Sir Jon Cunliffe (deputy governor, financial stability)

Andy Haldane (executive director, monetary analysis and chief economist)

Professor Silvana Tenreyro (external member)

Michael Saunders (external member)

Dr Gertjan Vlieghe (external member)

Professor Jonathan Haskel (external member)

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