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Big challenges for King replacement at Bank of England

Bank of England BoE Panorama 480

The successor to Bank of England governor Mervyn King will face “big challenges” with the ongoing challenges facing the UK economy and the establishment of bank oversight through the Prudential Regulation Authority, says Capital Economics UK chief economist Vicky Redwood.

An appointment is set to be named before the Autumn Budget on 5 December, with bookmakers favouring deputy governor for financial stability Paul Tucker, reports Redwood.

Redwood says: “It should not be long until we hear who will replace Sir Mervyn King as Governor of the Bank of England at the end of next June. It is thought that the appointment of a Bank ‘insider’ might just lead to a continuation of the status quo.

“But the difficult economic situation, combined with the expanding role of the Bank, means that whoever gets the job is likely to have to drive a change of thinking.”

According to Redwood, chancellor George Osborne is likely to avoid another “career economist” such as King, in favour of a governor with broader experience.

King announced he would be stepping down at the end of his term as governor on 30 June 2013 in February. The outgoing governor was appointed in 2003 and was first appointed to the court of the Bank of England in 1990, later becoming deputy governor in 1998.

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