Heteronomics 27 July 2017 BoE: Dave Ramsden adds monetary insight • Dave Ramsden will fill the vacant BoE seat of Deputy Governor for Markets and Banking from 4 September. Having sat in on MPC meetings for many years under King and Carney, he is well versed in the debate and its evolution. • While serving as Chief Economist at the Treasury (and head of the government economic service), Dave has clearly and candidly communicated the government’s position on a broad range of issues. He may become the first Deputy Governor outside of the monetary policy seat to express distinctive monetary policy views. • There are now no women on the FPC and only one on the MPC. This fact does not look good for the BoE but Dave is no less qualified as a result. Splitting the COO function back out to a new female appointee makes little difference. The Bank of England Monetary Policy Committee has been operating with only eight members since Charlotte Hogg was forced to stand down prematurely. Failure to disclose a potential conflict of interest in her brother’s job had caused intense pressure from the Treasury Select Committee (see BoE: hawkish dissent after Hogg roast). Ms Hogg proved a short-lived replacement for Minouche Shafik, who only served one term. Neither of them nor John Cunliffe ever expressed any distinctive views on monetary policy. Deputy Governors have tended to stay within their turf, which concentrated more power to Ben Broadbent on monetary policy. That the other deputies were not specialists in monetary policy probably contributed to the silos of views. Dave Ramsden is much more experienced in this area and may make a much bigger mark. Indeed, he regularly attended MPC meetings as the non-voting treasury representative and was often involved in the appointment process of other members (including the active solicitation of applications). When he joins the BoE as an insider on 4 September, there will be a new source of monetary policy insights at the table, which is always welcome. He will also play a lead role in the sterling monetary framework, including future reform of the settlement system. Since the unnecessarily intrusive hearings of Charlotte Hogg, Clara Furse and Gertjan Vlieghe, the Chair of the Treasury Select Committee (TSC) has changed. It is now held by Nicky Morgan who campaigned for the role with the intent to broaden TSC business beyond such hearings. A particular focus is intended to be Brexit, arguably to allow Ms Morgan’s Europhile views to regain prominence. As Dave Ramsden produced research from the Treasury that was widely incorporated into the Remain campaign, the new chair’s support for the EU should make his appointment hearing easier than it might have been. Where she might be less supportive is on the gender balance within the upper-echelons of the BoE. There is now only one woman on the MPC (see BoE: Silvana Tenreyro has some dovish form) and none at all on the FPC. It broadly fits the stereotypical look of an old boys’ club of bankers. As this one is a Treasury appointment, it can’t all be blamed on Mark Carney, though. Nor should it be blamed on Dave Ramsden who is a very well-qualified appointment. No gender realignment surgery needed. In a not unrelated announcement, the BoE has also appointed Joanna Place as COO. This role is, therefore, split back out into a separate function, having been briefly combined in Charlotte Hogg when she was appointed Deputy Governor. The BoE is keen to emphasise the importance of the role – e.g. “The COO has status and remuneration equivalent to the Deputy Governors”, leads with her appointment and provides a link to an image of only her. However, the COO role is a recent creation (2013) that nearly ended as a distinct function. The occupier does not influence market-relevant policies, so most people would have been unaware that Ms Place was already acting as COO since 1 May anyway. 1 Heteronomics | Bank of England 27 July 2017 DISCLAIMERS THIS MATERIAL IS: (I) FOR YOUR PRIVATE INFORMATION, AND WE ARE NOT SOLICITING ANY ACTION BASED UPON IT; (II) NOT TO BE CONSTRUED AS AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY IN ANY JURISDICTION; AND (III) BASED UPON INFORMATION FROM SOURCES THAT WE CONSIDER RELIABLE, BUT HAS NOT BEEN INDEPENDENTLY VERIFIED. Heteronomics does not accept liability for any act (or decision not to act) resulting from the use of this document and related data. This document does not constitute a personal recommendation within the meaning of applicable regulations or take into account the particular investment objectives, financial situations, or needs of individual investors. 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