Chancellor George Osborne should merge the incoming Financial Policy Committee (FPC) with the Monetary Policy Committee (MPC) to create a "single super-committee", it has been proposed.
The BBC's Robert Peston has suggested Osborne's carve-up of the Bank of England - which will see the new FPC sit alongside the MPC - is a "sub-optimal" solution because there is no real difference between delivering financial stability and monetary stability. Drawing on a speech from Bank of England deputy governor Paul Tucker, Peston said changes in interest rates can be an important driver of "risk premia", in turn impacting the macro-economic climate. So rather than separating monetary and financial policy, the Chancellor should consider bringing the two together in the form of a s...
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