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16 June 2009

Monetary Policy Committee: appointment of Adam Posen to the MPC

The Chancellor today announced that Adam Posen has been appointed to succeed Tim Besley as an external member on the Monetary Policy Committee. The appointment, which was made in accordance with the new process for external MPC appointments announced by the Chancellor in June 2008, will take effect on 1 September 2009.

The Chancellor said:

“I am delighted that Adam Posen has agreed to join the Monetary Policy Committee. Dr. Posen has extensive experience analysing central banking policy issues in the UK, the US, Japan and across the EU. His deep understanding of monetary policy and financial system issues, combined with his proven ability to communicate clearly to diverse audiences will, I believe, be extremely valuable to the MPC.”

Notes for Editors

1. Adam Posen is a Member of the Board of the Brussels European Global Economic Laboratory (BRUEGEL), a European think tank working in the field of international economics. In 2006 Dr. Posen spent seven months at the Bank of England as a Houblon Norman Senior Fellow and between 1994-1997 he worked as an Economist at the Federal Reserve Bank of New York. Dr. Posen’s areas of research include macroeconomic policy; the political economy of the European Union, Japan, and the United States; and economic relations among the major economies.

2. The Monetary Policy Committee makes decisions about the operation of monetary policy. It comprises the Governor of the Bank of England, the two deputy Governors, two members of the Bank with responsibility in the Bank for monetary policy and market operations and four outside members with relevant expertise who are appointed by the Chancellor. The appointment of external members is designed to ensure that the MPC benefits from thinking and expertise in addition to that gained inside the Bank of England. The Chancellor announced the establishment of the MPC as part of the new framework for monetary policy on 6 May 1997.

3. The Chancellor set out measures to strengthen the procedure for future appointments to the MPC in a letter to the Treasury Select Committee in June 2008. These included a commitment to advertise vacancies for the Governor and Deputy Governors of the Bank of England and also for external members of the MPC, consistent with the principles of open competition. Further details are set out in the Chancellor´s letter to the Treasury Select Committee.

4. Professor Tim Besley’s position was advertised in the media in April 2009. A panel comprising Dave Ramsden and Tom Scholar from the Treasury and Rachel Lomax, former Deputy Governor at the Bank of England, interviewed a number of candidates and made recommendations to the Chancellor, which informed his decision.

5. Future vacancies on the Monetary Policy Committee will continue to be advertised.


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