MPC Bank of England
Bank of England has appointed Michael Saunders. Photograph: Anthony Devlin/PA
Michael Saunders, an economist at the investment bank Citigroup, has been appointed to the Bank of England’s interest rate setting committee.
Saunders, a respected commentator on economics after more than 25 years at Citigroup, will replace Martin Weale whose term on the monetary policy committee (MPC) ends in August. Weale joined the nine-strong committee in 2010 having previously headed the National Institute of Economic and Social Research.— HM Treasury (@hmtreasury)
Michael Saunders appointed as external member of Monetary Policy Committee@bankofengland
Announcing the new appointment, chancellor George Osborne said Saunders would serve an initial three-year term on the MPC from 9 August.
“Michael brings a wealth of economic experience both on the UK and global economy and will make a strong addition to the MPC, ” Osborne said in a statement.— George Osborne (@George_Osborne)
Pleased to appoint Michael Saunders to Bank’s MPC – an economist with a wealth of experience on UK + global economy
Saunders is head of European economics at Citigroup, having joined the bank in 1990. Before that he worked briefly as an economist at Greenwell Montagu (now HSBC) and the Institute for Fiscal Studies. He studied econometrics at the London School of Economics.
When Saunders joins the committee in August he will be one of nine policymakers - seven men and two women - who each get a vote on interest rates. There are five full-time Bank of England insiders on the committee and four external members appointed by the chancellor, of which Saunders is one.
The chancellor has previously faced criticism for failing to appoint women to the policy committee and the Treasury said upon announcing Saunders’ appointment that it received 23 applications for the position, of which four were from women. The appointment last year of Nemat “Minouche” Shafik as one of the Bank’s deputy governors ended four years of an all-male MPC.
Bank watchers will now be trying to gauge whether Saunders will be a rate “hawk” with a tendency towards voting for rises in the cost of borrowing or a “dove” that advocates a more cautious approach. Outgoing policymaker Weale, who has served two three-year terms, is widely viewed as one of the committee’s more hawkish members, having voted for rate rises on 12 occasions.
Alan Clarke, economist at Scotiabank, put Saunders in the dove camp, but noted the Citigroup veteran was not as dovish as those economists advocating rate cuts.