Andy Haldane, the Bank of England’s chief economist and one of the strongest advocates that the UK economy will rebound strongly after coronavirus, is to leave in June.
Haldane is to become chief executive of the Royal Society for Arts, Manufactures and Commerce, a think tank that aims to resolve some of society’s trickiest challenges.
Haldane will step down from the BoE’s Monetary Policy Committee after its June meeting and start his new role in September.
Big loss for the Bank, big gain for @theRSAorg
In some ways Andy Haldane has acted more like an external member of the MPC in being prepared to challenge conventional wisdom and, in particular, look to disciplines outside economics for fresh insights. https://t.co/i8U4SoW3qD
— John Hawksworth (@jhawksworth5) April 13, 2021
The BoE said it would advertise for a new chief economist in due course.
Haldane said he shared the RSA’s sense of challenges from technology to longevity, from inequality to the environment.
“Meeting these new challenges will require new thinking, new policies and new partnerships between governments, industries and civil society, working in partnership,” he said in a statement issued by the RSA.
Haldane has been described as the most hawkish member of the MPC and famously said the UK economy was like a “coiled spring” waiting to recover from coronavirus.
Kallum Pickering, at Berenberg, said that sterling, as well as gilt yields, dipped slightly on the news, implying that the market judges a slightly more dovish tilt to the MPC once Haldane leaves.
“In recent months, Haldane has sounded more optimistic about the UK’s economic prospects than the Bank of England’s official forecasts. He has also highlighted potential upside inflation risks. Correctly, markets have judged Haldane’s stance as more hawkish than the general MPC consensus.
“But one member of the nine-member committee cannot drive policy alone. All policy decisions are determined by a majority vote.
“Should Haldane’s projections for the economic and inflation outlook prove correct, markets can expect the remaining committee members (plus his replacement) to take a suitably hawkish policy stance if and when the time comes.
Pickering added his call on actions by the BofE is unchanged by Haldane’s departure, with asset purchases completed by this year-end followed in 2022 by an exit strategy from its ultra-easy policy stance and bank rate hikes in 2023.