Swati Dhingra, an associate professor at the London School of Economics, will join the Bank of England’s monetary policy committee in August after Michael Saunders’ term expires, Britain’s finance ministry said on Thursday.
Dhingra, 41, will work at the MPC for a three-year term, which sets the interest rate. His academic focus is on the international economy and applied microeconomics – especially trade policy – and like many economists he has highlighted the cost of Brexit.
Dhingra will join the BoE just as inflation continues to touch 10% and will last longer than other developed economies – a problem that some economists have linked to greater trade and immigration friction since leaving the European Union.
“Both solid-level and overall evidence indicates that voting to leave the EU leads to lower growth, where both cost and investment play a role,” he wrote in a study with an LSE colleague in January.
Although the BoE has said that Brexit has increased headwinds towards growth and increased some inflationary pressures, it is reluctant to measure them and finds it difficult to offset its effects from the Covid-19 epidemic.
Participating in a Financial Times poll of economists published on January 3, he questioned the BoE’s ability to control inflation by the end of 2022 and the government’s ability to achieve a high-wage, high-productive economy. Short term
Saunders, who will replace Dhingra, is one of the more bizarre MPC members, and has broken the consensus to vote for a half-point interest rate hike in February and May.
Saunders has spent most of her career as an investment bank economist, and Dhingra’s appointment means the MPC will initially lack an outside member with a market or industry background – although Katherine Mann has spent three years as City’s chief economist.
Some British lawmakers have criticized the lack of diversity in the MPC.
Dhingra’s appointment will bring the number of women in the MPC to three, the highest on a nine-member committee since 2005, and she will be the first Asian woman to serve.
Dhingra studied for his bachelor’s degree at the University of Delhi and received his doctorate from the University of Wisconsin-Madison in the United States.
“Dr. Swati Dhingra’s experience in the international economy will bring valuable new skills to the MPC,” said Finance Minister Rishi Sunak.
BoE Governor Andrew Bailey also welcomed his appointment and research experience.