Published: Fri, September 14, 2018
Finance | By Loren Pratt

Carney to remain as Bank of England governor until 2020

Carney to remain as Bank of England governor until 2020

In his letter today, the chancellor explained that Mr Carney's extension was entirely Brexit related.

According to the Financial Times, May gave her approval to the idea which would likely see Carney remain in the role until the second half of 2020.

In the months after Britain voted to leave the European Union, however, he committed to an additional year as governor, citing "the importance to the country of continuity during the UK's Article 50 negotiations".

Hammond also confirmed that Carney, who said last week he was prepared to stay in his job beyond next June when his term was due to end, had agreed to remain until 2020. He had already agreed to extend his term to June 2019.

The pound was little changed after the news, despite the extension being shorter than some reports had suggested.

Bradley Fried, chair of the Bank's Court of Directors, welcomed their decisions to stay on: "Continuity in the outstanding leadership they provide will help the Bank succeed in our crucial work". He has been accused for much of his time at the bank of botching messages on policy. With the March Brexit deadline looming, the UK's future relationship with the European Union remains unclear, while Prime Minister Theresa May's current plan is proving unpopular with lawmakers both at home and overseas.

Anthony Gillham, head of investments at Quilter Investment, commented: "If Carney's tenure is extended he will have his work cut out, but the case for an experienced captain to guide the United Kingdom through risky waters has grown stronger as Brexit negotiations have dragged on". It could also mean the Treasury is struggling to find a replacement while it focuses on the political negotiations.

"I fully recognise that during this critical period, it's important that everyone does everything they can to help with the transition of exiting the EU", Carney said.

"I am willing to do whatever I can in order to promote both a smooth Brexit and an effective transition at the BoE".

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