Goldman Sachs hawk steps into Sentance’s Bank role

 
Julian Harris
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Goldman Sachs economist Ben Broadbent was appointed as the latest Bank of England rate setter yesterday, with many observers expecting him to support the move for higher rates.

Broadbent will replace outgoing chief hawk Andrew Sentance in June.

Sentance has consistently voted for higher interest rates since June 2010.

Broadbent’s team of economists at Goldman Sachs predicted rate hikes of 0.75 per cent by the end of this year, and an extra one per cent next year, according to a Reuters poll.

The Bank “has erred on the dovish side,” Broadbent recently wrote, citing its faith in “significant slack in the economy” and limited further commodity price inflation.

“One can take issue with these judgments, not least because some have been proved persistently wrong,” Broadbent wrote.

Yet Barclays’ Simon Hayes warned: “It is notoriously difficult to predict how a new member will behave.”