King warns Carney of his tough future

Tim Wallace
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OUTGOING Bank of England governor Sir Mervyn King yesterday welcomed the appointment of Mark Carney as his successor, describing the Canadian central banker as “outstanding”.

But Sir Mervyn also warned that Carney is coming to the role at a tough time, as the economy is in poor shape and the Bank is taking on new regulatory responsibilities.

“I am completely confident that with Mark Carney we have someone with whom the Bank is in good hands. I am sure he will carry out [the role] with very great distinction,” Sir Mervyn told MPs.

“The chancellor has selected a truly outstanding candidate.”

But that does not mean Carney will find the role easy. The Bank cut its growth forecasts earlier month – a move Sir Mervyn acknowledged he should have made earlier, as the global economy is so weak.

And Carney faces calls to reform the Bank, as major reports recently found its economic forecasting is poor and needs improvement.

Sir Mervyn’s management style is also under fire, after banking heavyweight Bill Winters told MPs recently Sir Mervyn crushed dissent and intellectual debate in the Bank – a charge denied by the outgoing governor.