The UK government has announced the appointment of Alan Taylor to succeed Jonathan Haskel on the Bank of England’s ratesetting committee.

Alan Taylor, a distinguished professor at Columbia University in New York with extensive advisory experience for major global financial institutions, will become an external member of the Bank’s monetary policy committee starting September 2 for a three-year term. This appointment allows Taylor to participate in the upcoming interest rate decision by the Bank.

Jonathan Haskel, 61, is concluding his five-year tenure as an external member, having joined in September 2018.

At 59, Taylor joins an MPC experiencing a notable divide, with factions differing on the urgency of interest rate reductions and the anticipated persistence of inflation.

While Taylor’s stance on interest rates remains somewhat ambiguous, his September 2023 research with the Federal Reserve Bank of San Francisco posits that stringent policies might restrain economic growth for over a decade. Additionally, he contributed to a study suggesting that pandemics could elevate the neutral interest rate by limiting labor supply, a perspective widely adopted post-Covid-19.

Rachel Reeves, the Chancellor, stated, “Professor Alan Taylor’s extensive background in both the financial world and academia will significantly benefit the monetary policy committee.”

Taylor holds the position of professor of international and public affairs at Columbia and has served as a senior advisor to financial giants like Morgan Stanley and PIMCO. Born in Wakefield, West Yorkshire, he is an alumnus of King’s College, Cambridge, and holds a doctorate in economics from Harvard University.

Reeves expressed gratitude to Haskel for his service on the monetary policy committee, noting his hawkish stance on interest rates. Over the past year, Haskel has frequently advocated for rate hikes when others preferred to maintain or lower them.

Haskel, also a professor of economics at Imperial College Business School in London, recently co-authored the book “Restarting the Future: How to Fix the Intangible Economy” with Stian Westlake, which explores the significance of intangible assets in economic growth.

At the MPC’s latest meeting on August 1, Haskel, alongside Catherine Mann—another external member known for her hawkish views—Huw Pill, the chief economist, and Megan Greene, voted to maintain the base interest rate at 5.25%. This group was narrowly outvoted by five MPC members, including Governor Andrew Bailey, who supported a quarter-point reduction to 5%.

Robert Wood of Pantheon Macroeconomics commented, “Haskel’s departure, given his hawkish stance, is likely to tilt the MPC’s balance of views towards a more dovish direction.”