BOE head must be politically sensitive: Barker

Bloomberg

It’s important that the next governor of the Bank of England is politically sensitive, according to Kate Barker, who is part of the panel interviewing candidates for the job.
“If you’re really appointing a governor for eight years, it’s pretty difficult to foresee
the political circumstances through that eight years into which this person is going to have to play themselves,” the former BOE policy maker said at an event at Bloomberg‘s London offices.
“So it is important to have somebody who is going to be properly politically sensitive, not in the sense that they will give up central bank independence, but in the sense that they understand that the credibility of policy is best served by being politically sensitive.”
Mark Carney, the current governor, is due to step down early next year and finding a successor is one of the most high-profile decisions facing new Chancellor of the Exchequer Sajid Javid since his appointment in July.
A group of lawmakers this week called on him to publish the shortlist of candidates in order to boost transparency and public trust in the selection process.
The campaign group Positive Money, which coordinated the lawmakers, also cited concerns that that the current government might “bypass the selection process” and “install a political ally who did not otherwise make the shortlist.”

‘Helicopter money would put BOE at risk’
Bloomberg

Tackling future recessions with helicopter money risks central bank independence and should be a final resort, Bank of England policy maker Gertjan Vlieghe warned.
Introducing such a policy of distributing money to the public becomes “quite a radical policy option” if the central bank also does not pay interest on reserves,
he said at an event at Bloomberg’s London offices on Monday.
“By mechanically keeping rates stuck at zero, the reserve expansion effectively suspends for a period both the instrument and the target of the central bank. Therefore, it effectively suspends for a period central bank operational independence,” Vlieghe said.