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Goldman Sachs economist given go-ahead for MPC

Goldman Sachs economist Ben Broadbent has been approved as an external member of the Monetary Policy Committee by the Treasury select committee.

Broadbent has worked at the Treasury and the Bank of England and was formerly an assistant professor at Columbia University.

The TSC says it is satisfied with the appointment made by Chancellor George Osborne in March and that Broadbent has the professional competence and personal independence for the role.

He will join the MPC on June 1, participating in his first meeting on June 9.

The committee also said it was satisfied with the appointment of Dr Donald Kohn as an external member of the interim Financial Policy Committee. Kohn was previously vice chairman of the board of governors at the US Federal Reserve.

The interim FPC sits within the Bank of England and will develop macroprudential tools to deliver financial stability in preparation for the full FPC to begin operating some time in 2012/13. The interim FPC will sit for the first time on June 16.

Ex-Confederation of British Industry Sir Richard Lambert was also due to face the committee about his appointment to the FPC but turned down the position last week.

Broadbent replaces rate-rise hawk Andrew Sentence who will step down at the end of this month, leaving a committee currently split 6-3 on whether to raise rates to deal with persistently high inflation.

It has been reported that Broadbent will lean towards raising rates sooner rather than later.

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