Chancellor Rishi Sunak has chosen a vocal Brexit critic as the next member of the Bank of England’s interest rate setting committee.
Dr Swati Dhingra, an associate professor at the London School of Economics who previously called on the government to ‘cancel Brexit’, will join the Monetary Policy Committee (MPC) in August, arriving during one of the most difficult times faced by the plant. bank.
An Indian-born academic who earned a doctorate in the US before moving to the UK, Dhingra will join the group as inflation is expected to top 10% and the economy could slide into recession.
The first Asian woman to be appointed to the post, her arrival means that a third of the nine members of the policy-making group are women, for the first time since 2005. This number has never been exceeded, leaving the Bank well below gender parity. .
Dhingra and his colleagues at LSE have tracked relations between the UK and its continental neighbors since the Brexit vote in 2016 and, in successive reports, have found the economic damage to be extensive.
Ahead of the December 2019 parliamentary vote to leave the EU’s single market and customs union, Dhingra wrote with a colleague in LSE’s Brexit Economics series: “From an economic point of view, the best policy would be to ‘Cancel Brexit’.
While Tory MPs and Cabinet members bristle at claims that much of the rise in inflation in the UK can be blamed on Brexit’s negative impact on trade and immigration, its appointment is likely to be controversial.
Her wider research into the UK’s trade links with China, the Far East and the US means she will bring extensive expertise into Britain’s challenges as it seeks new markets export.
The search for expertise in specialist areas to fill the four external positions within the MPC – the other five being filled by central bank staff – is an ongoing trend. In 2018, the Treasury appointed Jonathan Haskel, an economist at Imperial College, to bolster the committee’s understanding of worker productivity.
Dhingra will replace former city economist Michael Saunders when his term ends. Saunders, known for voting to raise interest rates when his colleagues preferred to keep them low, was outvoted at this month’s MPC meeting when he was among three members to say that ‘there should be a 0.5% increase and not the 0.25% increase that the majority Agree.
Dhingra should be more cautious amid a cost of living crisis which could be aggravated by an increase in the cost of borrowing. She will serve a three-year term, which can be extended to a maximum of six years by the Chancellor.
She said: “The committee’s work is of great importance as the UK faces an exceptional cost of living crisis amid the global challenges of the pandemic and war.”
Dhingra studied for her undergraduate degree at the University of Delhi. She received a doctorate from the University of Wisconsin-Madison in the United States and was a scholar at Princeton.
“Dr. Swati Dhingra’s background in international economics will bring valuable new expertise to the MPC,” Sunak said.
Bank of England Governor Andrew Bailey said: “I am very pleased to welcome Dr Swati Dhingra to the MPC later this year. His insights and perspective will be extremely beneficial to all of our discussions and we will benefit from his extensive research in international economics.