For many in the market, the last thing the UK and its currency needs is for the governor of its central bank to be unceremoniously axed for disagreeing with those who backed Brexit.
As IG market analyst, Joshua Mahony, characterised it: “Amid a lot of criticism emanating from the Brexit camp, there is a wider feeling that Carney has been a reliable governor. Given the complete shake-up in parliament following the June referendum, perhaps it is time to seek stability rather than further uncertainty.”
But, there is a bigger point to be made here. For all the bluster about Carney’s playing at politics ahead of the referendum, any move now to remove him is only likely to further damage perceptions of the Bank’s independence; either his replacement will be considered too close to Theresa May or, unlikely to want to go too far out on a limb for fear of a similar axing.
Equally, in a world in which governments have consistently allowed central banks to step further away from traditional central banking and closer to the limits of both their ability and credibility, criticism of the BoE (or any other central bank, come to think about it) for not remaining strictly apolitical come across as somewhat naïve.
There is no doubt that a strong case can and should be made for an independent central bank, but it is harder to argue that it is or can be an entirely apolitical body.
And, while there has been some justifiable criticism of the success of Carney’s forward guidance policy, few can argue with his aptitude for the increasingly political aspects of the job.
As Treasury Select Committee chair, Andrew Tyrie said of Carney during that March hearing, his cautious cadence is reminiscent of that of one “who might easily have made a career as a bomb disposal expert”.
With May’s hand on the Brexit trigger, such skills could well come in handy.
