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Bank of England Governor Andrew Bailey resumed rate hikes on Thursday, but came under renewed attack from senior Conservative Party officials after he refused to say whether the 10th-ranked leader was doing a good job.
A No. 10 spokeswoman said Bailey “continues to have the prime minister’s support” after being repeatedly pressed, but did not say Rishi Sunak thinks she is in good shape. rice field.
Some Conservatives accused Mr Bailey of failing to act quickly to curb inflation, necessitating a further increase in interest rates to 5%, putting more pressure on mortgage holders.
A member of parliament said: I He argued that the governor was “leading incompetent management” of the economy and was “a year behind on interest rates,” and that faster action could have given people time to plan for higher mortgage costs.
The lawmaker said Bailey “always seems completely lethargic”, so it’s not a good idea to hire someone with experience like former Gov. He should be replaced with a safe aide,” he said.
Other Conservatives backed assessments that the Bank had failed to act quickly. “If the Bank of England had acted sooner, we wouldn’t have had to go all this way,” the former minister said. “Banks should have seen what was going on.”
Others have accused the Bank of Japan of pushing inflationary pressures too far by pushing quantitative easing (QE), which has pumped money into the economy through bonds over the past decade or so, for too long.
Liz Truss, who criticized the World Bank during its disastrous tenure as 10th, told friends that monetary policy had failed, that the Bank’s quantitative easing program had expanded too quickly, and that interest rates should have been raised sooner. believed to have spoken.
Another Conservative senior official said the central bank should have waited for the effects of early rate hikes to be felt before raising rates again. “The Bank of England has a lot of question marks on both starting and ending rate hikes.”[ing] Quantitative easing is too late and is definitely pushing up interest rates at a time when the effects of previous rate hikes have not yet been felt,” the lawmaker said.
On Wednesday, Transportation Secretary Mark Harper became the first cabinet minister to shower Bailey with contempt, saying both Sunak and the government had anticipated the danger of a prolonged period of high inflation even before he became governor.
Asked if the World Bank was slow to raise rates, Harper told Sky News: “Some criticize that, but there was a decision to be made early on whether the inflation was temporary or not.” rice field. Rishi Sunak made it clear during his premiership that inflation was a problem, and he recognized it early on. ”
This follows Bailey’s comments in 2021 that inflation would be “temporary” as the global economy recovers from a pandemic-induced slowdown.
Downing Street said the government would “work closely” with the central bank on “the shared priority of controlling inflation”, but declined to be embroiled in questions about Bailey’s performance.