Latest news with #AndrewBailey
Daily Mail
an hour ago
- Business
- Daily Mail
Bank of England Governor hits back at Reeves over regulation
By Andrew Bailey yesterday put himself at odds with Rachel Reeves over the Chancellor's outspoken attack on regulation. The Bank of England Governor made clear that he did not share Reeves' recent claim that the enforcement of red tape acted as a 'boot on the neck' of business. Andrew Bailey yesterday put himself at odds with Rachel Reeves over the Chancellor's outspoken attack on regulation. The Bank of England Governor made clear that he did not share Reeves' recent claim that the enforcement of red tape acted as a 'boot on the neck' of business. Speaking to MPs on the Treasury select committee, he urged caution over a proposed shake-up of the ring-fencing system that separates traditional lending and deposit-taking from riskier investment banking. The comments appear to be a shot across the bows of the Chancellor as she seeks to unravel some of the reforms put in place during the financial crisis in a bid to boost growth. They suggest she may face an unwanted battle with Threadneedle Street to add to friction with Labour backbenchers over spending cuts and the battle to balance the books, amid dismal economic growth and deteriorating public finances. Reeves took aim at regulators during her Mansion House speech to the City earlier this month. But Bailey chose to dissociate himself from the 'boot on the neck' comments. He said: 'It's not a term I'd use. 'I think there are areas that we clearly should look at it – we've announced a whole range of things we're doing, and that's a good thing. But we can't compromise on basic financial stability and that would be my overall message.' Reeves has also promised 'meaningful reform' of the ring-fencing regime – something being demanded by the bosses of a number of major banks who say they are a drag on business. But Bailey said he favoured keeping the rules. He told MPs: 'I do think that the ring-fencing regime is an important part of the structure of the banking system.' Bailey said the rules make it easier to deal with banks that get into trouble in a way that spares consumers, businesses and households. He added: 'I'm sure there are things that can be improved and we will work constructively to get through that process.
Time of India
20 hours ago
- Business
- Time of India
Bank of England considers shelving plans for a digital pound
LONDON: Bank of England officials are mulling whether to set aside plans to create a digital pound for households amid growing skepticism about the project's benefits, the latest sign of dwindling support for state-backed digital currencies globally. The BOE has been privately urging the banking industry to instead accelerate payment innovations that could result in similar benefits without the creation of a central bank digital currency - or CBDC - for consumers, according to people familiar with the matter. Explore courses from Top Institutes in Please select course: Select a Course Category Cybersecurity Technology Data Science Artificial Intelligence Leadership others Degree PGDM Product Management Design Thinking Finance CXO healthcare Management Digital Marketing Project Management Data Science Public Policy MBA Healthcare Others Operations Management Data Analytics MCA Skills you'll gain: Duration: 10 Months MIT xPRO CERT-MIT xPRO PGC in Cybersecurity Starts on undefined Get Details The people said the central bank wants to be in a position to launch a CBDC if it is eventually warranted. But it is willing to step back if private businesses continue to roll out new electronic-payment technologies, and its staff believe the gains from pressing ahead with a digital pound launch have diminished. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cleanse your yoga mat like a pro: say goodbye to germs and bacteria! Kingdom Of Men Undo The BOE declined to comment. But Governor Andrew Bailey on Tuesday said at a Parliamentary hearing that "if the work with the commercial banks is successful, I would need a lot of convincing" on the need for so-called Britcoin. "I think that's a sensible place to do it," he told the Treasury Committee. "If that's a success, I question why we need to introduce a new form of money." Live Events The bank's latest approach marks a shift in its tone from only a few years ago, when BOE and Treasury officials said they thought a digital pound was "likely" to be needed. They will make a joint decision on whether to push ahead with the project once the current "design" phase is complete. The BOE governor previously voiced his doubts publicly and has put his focus on banks stepping up a push to tokenized deposits, which is seen as a way to create a stable bridge between traditional finance and digital assets. The change reflects the dwindling interest globally in the creation of state-led digital currencies as stablecoins and other payment innovations emerge. The Trump administration has blocked further work on a CBDC in the US, citing financial stability concerns, and last month South Korea's central bank halted its digital currency pilot program. In contrast, the European Central Bank is still pressing ahead with the launch of a digital euro. Recent research by BOE staff found that the benefits from launching a CBDC are diminishing and senior officials have stepped back from chairing a committee that discusses the project with the private sector in a possible sign of declining interest.
Daily Mail
20 hours ago
- Business
- Daily Mail
QUENTIN LETTS: With his drip dry suburban ways, there's something furtive about the Governor
Bank managers are often thought stodgy presences. But as Andrew Bailey demonstrated at the treasury select committee, they are crazily optimistic loan sharks. Their purpose in life is to persuade happy people to borrow money, which frequently brings misery. 'It'll be fine,' they say. Bank managers are maniacs. Outwardly Mr Bailey is unexciting. They're always the most dangerous. The sober socks, bland suit, Pooterish manner, and a retinue of six clerical mice who traipse after him with earnest haircuts and dark shoes: it is a brilliant disguise. We think, 'he'll be safe', but we'd be safer being driven home from an all-night bender by the late Ayrton Senna. Mr Bailey is governor of the Bank of England. His time in charge has so far seen the mad printing of money, blindness to inflation after lockdown and a regulatory laxness that hastened the Truss government's destruction. Yesterday he was asked if Rachel Reeves was borrowing too much. Noooo, said Mr Bailey. Everything's under control. He slipped easily into jargon mode, burbling that yield curves were steeper across the world. As he did this he narrowed his eyes a little to convey shrewd expertise. He placed his elbows on the witness table and touched the skin of his brow, quite the expert intellectual. Carry on borrowing, Chancellor. It's all going swimmingly. That was his siren song. Dame Meg Hillier (Lab), chairman of the committee, was surprised. 'You sound unconcerned,' honked Mother-Goose Meg. Mr Bailey, suppressing just a hint of indigestion: 'I'm not unconcerned. It's reflective of conditions. There is an uncertainty in geopolitics, I'd say.' Dame Meg boggled a bit at his calm tone. We were talking here about trillions of pounds and an interest bill that could bankrupt us. Mr Bailey soothed Dame Meg with a not-quite convincing smile. He noted that the market capitalisation of a single US firm is now greater than Britain's gross domestic product. Was that meant to be reassuring? Unlike his talcum-powdered predecessor Mark Carney this Bank governor is not a magnetic figure. When he enters a room, people do not hush. When Mr Carney shimmered down a corridor, you could almost hear Sade's 'Smooth Operator'. Mr Bailey, with his crinkly hairdo and drip-dry, suburban ways, lacks charisma. He fiddles with his chin and neck when talking. His fingers twiddle with a slender ballpoint pen. There's something not quite right about him. Something flawed. Furtive. When Ms Reeves first started to meet him, she possibly suspected that she was the senior partner in the relationship. Now, as she looks at our economy going down the plughole, she must wish she had never listened to his burbling reassurances. He was accompanied by two external members of the Bank's financial policy committee. Carolyn Wilkins, a Canadian policy wonk, was largely inaudible. Prof Randall Kroszner, known as 'Randy', sat on the very edge of his chair, his spine ramrod straight. Randy was Norman R. Bobins professor of economics at Chicago university, a director of the George J. Stigler Center for the Study of the Economy and the John M. Olin visiting fellow of law at Chicago law school. Randy turns left on aeroplanes. We possibly need to keep Rachel Reeves away from such people. It being the last day of term, Westminster was pretty empty. The education committee was holding an inquiry about truancy. Jolly bad luck. It meant most of them had to turn up. And in the Commons chamber Wes Streeting took health questions. Wes is already quite bronzé. Not a fleck of grey taints his inky, modishly ridged fringe. Add a rich, blue suit and just a hint of tummy. During longueurs he effortlessly attended to his mobile telephone. He paid handsome tribute to his Tory shadow, Edward Argar, who is retiring from the front bench. And he relished talking about the resident doctors' strike, which we must all hope he wins. The Starmer Government has had a hellish first year but little Wes is loving life.
Telegraph
a day ago
- Business
- Telegraph
Debt-addicted Britain needs a dose of shock therapy
Britain is increasingly living like a junkie, struggling just to cover the interest on his tick. Debt is our drug, and the dealers want paying. Figures released on Tuesday by the Office for National Statistics show we borrowed nearly £21bn in June alone. That's despite tax revenues rising by almost £6bn compared with the same month last year – thanks to fiscal drag boosting income tax by £1bn, and the Chancellor's National Insurance raid adding over £3bn more. The habit is proving impossible to kick. State spending has ballooned, and the cost of servicing our debt addiction has soared. In June, debt interest hit £16.4bn, nearly double what it was a year ago and the second-highest monthly bill on record. We now spend more feeding our debt in a single month than we do policing our borders in an entire year. Things are worse now because of how we've structured our debt, how we got hooked. One of our main suppliers of the debt drug was Andrew Bailey and his Bank of England who kept us dosed up on cheap borrowing long after it was clear that interest rates would have to rise. The hundreds of billions printed during the Bank's QE programme, along with interest rates held too low for too long, maxed the risks and emboldened the Treasury to binge. Rather than lock in long-term deals while rates were rock-bottom, we chased short-term fixes. And we wanted a bargain. To lure bond markets, we promised inflation-proof debt – index-linked gilts – in exchange for lower upfront costs. It only worked so long as inflation stayed low. It didn't.
Yahoo
a day ago
- Business
- Yahoo
Bank of England governor warns Labour against watering down financial rules
Bank of England governor Andrew Bailey has warned the government that dismantling the UK's banking ring-fencing regime 'would not be sensible', amid the UK government's push to "regulate for growth". Speaking to MPs on the Treasury Committee following chancellor Rachel Reeves' Mansion House speech last week, Bailey defended the current system, which separates retail and investment banking operations. The regime was introduced in the wake of the 2008 financial crisis to reduce systemic risk and protect consumers in the event of bank failures. 'I do think the ring-fencing regime is an important part of the structure of the banking system,' Bailey told the committee. 'It makes the resolution of banks if they're in trouble much easier, and it benefits, particularly in terms of the UK, consumers, business and households.' While the chancellor has argued that outdated regulation is hampering growth, Bailey pushed back against the suggestion that financial oversight could be relaxed. 'I'm sure there are things that can be improved and we will work constructively to get through that process,' he said. 'I think it has established itself as part of the system and to me it would not be sensible to take it away at this point.' Read more: Reeves calls on regulators to loosen rules in push to spur investment Reeves, addressing banking leaders at Mansion House, described financial red tape as a 'boot on the neck of businesses' and called for UK regulators to abandon what she termed 'excessive caution'. The remarks were part of a broader bid to accelerate the UK's economic by having financial watchdogs "boldly regulate for growth... in the service of prosperity across our country'. Bailey, however, stressed that financial stability should not be traded off against growth ambitions. 'There isn't a trade off between financial stability and growth,' he said, underscoring the central bank's commitment to maintaining the resilience of the UK's financial system. The governor also addressed suggestions that the regulatory environment may be outdated. 'I can understand when I hear people say 'the financial crisis is now way in the past, we've got passed that, that's all solved, that's all out of the way, move on',' he said. 'For those of us who were veterans of sorting the problems of that out, I think we probably all feel in some ways were in different parts of the world, erm... no.' 'Yes of course the world moves on,' he added. 'That was the experience of losing financial stability. We had a very serious recession in this country after that. So I do react to people who say that because, I'm sorry, this is the fundamental point about why financial stability is important.' He also talked about the quiet effectiveness of robust regulation: 'Success in financial stability is when nothing happens. The fact we've had market volatility this year and we haven't had a financial stability problem and we're not worrying about banks failing, we're not the market, is of course a success. It's not always easy to point to it and say, look, this is good news. But the UK banking system is very resilient.' When asked directly about Reeves' 'boot on the neck' metaphor, Bailey declined to repeat the language. 'I don't use those terms. Let me say that ... it's not a term I use,' he said, before adding: 'We can't compromise on basic financial stability. That would be my overall message.' Read more: UK's rising debt cost puts Reeves and tax rises in spotlight Separately, the governor said that the rise in UK government borrowing costs was not out of step with international trends, downplaying concerns that the UK was facing uniquely adverse market conditions. 'We have seen steepening of yield curves going on now,' Bailey told lawmakers. 'I think the important thing to say is that is a global phenomenon. It's not in any sense unique to this country. In fact, the pattern in this country is not in any sense out of line with what we've seen in other markets, and we've seen steeper increases in some other markets.' According to Bailey, the pressure on borrowing costs is being driven by global concerns, including shifts in trade policy and fiscal uncertainty. He pointed to recent events in the United States, where president Donald Trump has imposed tariffs on a wide range of imported goods and secured tax cuts expected to add significantly to the US federal deficit. The Bank of England governor also cast doubt on whether the UK's central bank will introduce a digital currency, having worked on the project for several years. Bailey told MPs that he would need 'a lot of convincing' to push through the plan, if existing work to push digital technology into the commercial bank payment systems is a success. Read more: FTSE 100 LIVE: London stocks tread water as UK borrowing jumps above £20bn Trending tickers: AstraZeneca, Verizon, Opendoor, Trump Media and Lindt & Spruengli Gold prices hover near one-month highError in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
