Andrew Bailey is the 'worst Bank of England boss' says Malone
Out of the nine top executives on the Bank of England’s (BoE) Monetary Policy Committee (MPC), seven do not have a mortgage.
The MPC “sets monetary policy to meet the two percent inflation target, and in a way that helps to sustain growth and employment.”
With inflation running far above this benchmark – to the tune of 8.7 percent in the year to April – the UK interest rate has been raised 12 times consecutively since the end of 2021.
This, in turn, drags up the cost of mortgages. The monthly cost of a new mortgage for a semi-detached house rose by 61 percent in 2022.
The MPC’s members have a joint property portfolio worth some £13million but, according to Land Registry data, only two have had to take out a home loan. This means the people burdening ordinary Brits with soaring housing costs are conveniently spared themselves.
The MPC is made up of BoE Governor Andrew Bailey, three Deputy Governors for Monetary Policy, Financial Stability and Markets and Banking, a Chief Economist and four external members appointed directly by Chancellor Jeremy Hunt.
They are not ordinary Brits. When Mr Bailey took over in 2020 the BoE’s Remuneration Committee set his annual salary at £495,000 – or exactly 15 times the median wage.
He reportedly has no mortgage on his £1.4million property. Documents make no mention of a mortgage for Chief Economist Huw Pill – who, on £190,000, recently said people should accept they are “all worse off” – Deputy Governor for Markets Sir Dave Ramsden, Deputy Governor for Financial Stability Sir Jon Cunliffe or external member Jonathan Haskel.
A BoE spokesperson, however, claimed one of those five had recently taken out a home loan. Deputy Governor for Monetary Policy Ben Broadbent has a mortgage on a £3million flat in London’s luxurious Knightsbridge area.
External members Swati Dhingra, Silvana Tenreyro and Catherine Mann, meanwhile, rent property in London.
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On the day of the Chancellor’s Spring Budget in mid-March, the Treasury’s independent watchdog, the Office for Budget Responsibility forecast inflation would fall to 2.7 percent by the end of the year.
According to the IMF, high interest rates are crucial for this goal to be achieved.
Last July, Sir Jon Cunliffe said five percent was the level at which mortgage borrowers and companies would run into debt distress. The interest rate is currently at 4.5 percent, but experts believe it could peak at 5.5 percent later this year.
According to Uswitch, the average five-year fixed-rate mortgage rate in the UK is already 5.15 percent. In September 2021 it was just 3.6 percent.
The MPC sets and announces policy changes roughly once every eight weeks, and is next scheduled to meet on June 22.
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