BANK of England governor Mark Carney has been savaged by a former interest rate-setter who accused the Canadian of ‘lacking confidence’ and called for him to be replaced by a Brit.
Andrew Sentance, a former member of the Bank’s monetary policy committee, said the Treasury should not look overseas again as it begins compiling a short-list of candidates to take over from Mr Carney.
In an explosive critique of his reign, Mr Sentance, now a senior economic adviser at professional services firm PwC, 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.
The Canadian’s appointment in 2013, replacing Sir Mervyn King, saw him become the Bank’s first foreign governor. A Treasury source said the recruitment process for his successor will be ‘open and fair’ and the appointment would be made ‘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. The failure to raise rates since the start of 2014 risks leaving the economy facing a ‘stagflation scenario’, he warned.
He added he would ‘like to see a woman heading the Bank’, but admitted the lack of strong internal candidates made it unlikely in the short term.