Bank of England's Carney to stay until January 2020 to smooth Brexit
* Carney to extend stay at BoE by a further 7 months
* Hammond says will provide "vital stability" after Brexit
* Brexit campaigner Farage calls reappointment "appalling"
* Financial market economists welcome move
(Adds further economist and political reaction)
By David Milliken and Andy Bruce
LONDON, Sept 11 (Reuters) - Bank of England Governor Mark
Carney will stay at the central bank an extra seven months until
the end of January 2020 to help smooth Britain's departure from
the European Union next year, finance minister Philip Hammond
told parliament on Tuesday.
Carney had been due to step down at the end of June 2019 --
having extended his term by a year already to cover the
immediate months after Brexit -- but last week he told
legislators he would be willing to stay longer if requested.
British media had previously reported the finance ministry
was keen for Carney to extend his stay and was having difficulty
finding a suitable successor.
"I am willing to do whatever I can in order to promote both
a successful Brexit and an effective transition at the Bank of
England and I can confirm that I would be honoured to extend my
term to January 2020," Carney said in a letter to Hammond.
Before Carney joined the BoE in July 2013, he said he only
wished to serve five years of the standard eight-year term for a
BoE governor to minimise his children's time away from their
Hammond said Carney would provide "vital stability" for
Britain's economy during the Brexit transition and the extension
was also welcomed by Nicky Morgan, the chair of the parliament
committee which monitors the BoE and the finance ministry.
Deputy Governor Jon Cunliffe would serve a second five-year
term until October 2023, Hammond added.
Carney focused heavily on minimising financial market
turmoil in the run-up to June 2016's European Union referendum
and has warned since of the costs of a disorderly Brexit,
drawing fire from Brexit supporters.
Nigel Farage, former leader of the pro-Brexit United Kingdom
Independence Party, said the reappointment was "truly
But financial market economists broadly welcomed the
extension for Carney, who early during his period of office
gained the moniker of an "unreliable boyfriend" due to mixed
signals about the future path of interest rates.
Last November the BoE raised rates for the first time in
more than a decade and increased them again last month, when
Carney said that market expectations of a further rate rise a
year for the next few years would be a reasonable rule of thumb.
"It would have been preferable to have avoided a piecemeal
extension to his term at the Bank. But bearing in mind the
uncertainties in the economy, I think it's a good thing he's
staying," Investec economist Philip Shaw said.
(Editing by Michael Holden and Alison Williams)
First Published: 2018-09-11 13:29:39
Updated 2018-09-11 15:01:04
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