Mark Carney, between the devil and the deep blue sea

THE GOVERNOR of the independent Bank of England must have known as he set off to appear before a hearing of the Treasury Committee at the Houses of Parliament on March 8 that whatever he said would garner praise from one set of listeners and opprobrium from a different set and that was very much the case.

Officially, the Bank is not taking sides in the EU referendum debate but as an intelligent man holding a very important job, he must have been aware that what he said would carry weight and would be listened to quite seriously by voters and business leaders as well as politicians around the world.

He had submitted a report to the committee which certainly appeared to be very much against the Brexit and spurred conservative MP and fierce pro Brexit campaigner Jacob Rees-Mogg to seriously disagree both with his opinion and the very fact that he appeared to be so partisan in his comments.

Mr Carney said risks from an EU exit included the Bank’s ability to control inflation, a fall in the pound and banks moving abroad, although he confirmed that if Britain votes to leave the EU, “we will do everything in our power to discharge our responsibility to achieve monetary stability and financial stability”.

Mr Rees-Mogg said his comments both in the report and at the meeting were “beneath the dignity of the Bank” which Mr Carney rejected completely and repeated that the Bank would remain neutral in the debate although it had to respond to questions with regards to its view of the financial future.

The governor went on to say “I have not had conversations with the Prime Minister about what I might say about the European Union.”

In addition he mentioned that there were measures that the Bank of England could take in the short term to support the financial system but said he could not rule out the possibility that there could be issues with stability.

As expected, those who are in favour of Britain remaining within the EU have already started quoting Mr Carney, whilst those who want to see Britain leave are accusing him of using his position in order to try to influence voters.