Economist who lambasted Brexit and Liz Truss joins Bank of England
The Bank of England has named a top economist who attacked Brexit and Tory “mismanagement” as the newest member of its interest rate-setting panel.
Megan Greene will become a member of the Bank’s powerful Monetary Policy Committee (MPC) when Silvana Tenreyro steps down in July, it has been announced.
Ms Greene has previously expressed strong views on the UK’s exit from EU and the economic turmoil of Liz Truss’ brief period as premiership.
“Brexit is bad for the UK economically,” the American economist told Bloomberg back in December 2017. “There will be uncertainty for a long time.”
The economist also said “there has been a lot of economic mismanagement” in the UK when discussing the Truss premiership with the BBC Radio 4’s Today programme in October.
She also said “Brexit is really asserting itself now”, saying international investors “were still wary” of Britain because of a whole series of economic challenges facing the country.
Ms Greene, global chief of US risk management company Kroll, joins the rate-setting committee at a time of great fragility for the economy, following 11 successive rises in interest rates as the Bank tries to dampen inflation.
Her successor Ms Tenreyro was seen as one of the MPC’s “doves”, often voting against the consensus in favour of lower interest rates to support growth through jobs.
“While we don’t know too much about Ms Greene’s stance on monetary policy, we can say one thing: it will be hard for anyone to be more dovish than Ms Tenreyro,” HSBC’s Elizabeth Martins told Reuters.
It comes as the International Monetary Fund (IMF) upgraded its forecast for the UK economy this year and next – but still expects it to grow slower than other Group of Seven (G7) countries.
UK output is expected to contract by 0.3 per cent this year before rebounding to grow by 1 per cent next year, economists working for the body said. It puts the UK firmly at the bottom in the G7 group of advanced economies this year.
The IMF also said that interest rates in major economies would fall in the future because of low productivity and an ageing population – describing recent rises as “temporary”.
But the Bank of England – which has hiked rates from 0.1 per cent to 4.25 per cent since December 2021 to tackle the inflation crisis – is expected to increase rates again in May.
Andrew Bailey, the Bank of England’s governor, said Ms Greene “brings significant experience from her work across financial services and academia and we will benefit greatly from her contributions to our policy discussions”.
Chancellor Jeremy Hunt said her “wide experience across financial markets and the real economy” would “bring valuable new expertise” to the Bank.