Andrew Bailey is set to take over as the governor of the Bank of England in March, with Mark Carney handing over the reins. Typically, the changing over of this role is smooth given that policymakers have already elected the incoming governor and the market is aware of the change well ahead of time. However, this transition is proving not to be so run-of-the-mill.
Miller Calls Bailey “Toxic”
A campaign led by Gina Miller, the political activist who led the court case against the British government over Brexit, is now calling for a review of the BOE’s choice of governor. Miller’s campaign asserts that Bailey’s time as head of the Financial Conduct Authority was marred by a “toxic cocktail of negligence, incompetence and indifference”.
Miller’s campaign group has written to the head of the Treasury Select Committee, Mel Stride, as well as the chancellor Rishi Sunak, requesting that Bailey be made to testify over a number of financial scandals which unfolded during his time resulting in the loss of savings b many small investors.
Miller’s “True and Fair Campaign” says it has compiled a “damning dossier” of Bailey’s alleged negligence during his time as the chief executive of the FCA. Among the scandals which Miller claims Bailey failed to address was the group’s handling of the Lloyd’s Turnbull Report in which former Lloyd’s employees accused executives of covering up fraud at the group’s HBOS branch in Reading. Miller also cites the liquidation of Neil Woodford’s investment fund as another scandal which was handled poorly by the FCA.
Miller has been ruthless in her criticism of Bailey, claiming that “On his watch, tens of thousands of Britons have lost money – in many cases losing their life savings which has devastated their lives, families and business.”
The campaign, which has a petition needing 100,000 signatures to require a parliamentary review of Bailey’s appointment, has been backed by Labour. The Shadow Chancellor John McDonnel said “This report reinforces that we were right to call on the last chancellor on several occasions to postpone the installation of Andrew Bailey in office as governor until there had been an independent review of his role at the FCA.”
Finance Ministry Rejects Claims
Despite the pressure, Britain’s Finance Ministry has rejected the claims made by the True & Fair campaign saying that the report contains “numerous inaccuracies” and responded saying that: “In fact through FCA interventions millions of people have benefited including the most vulnerable in society”. The BOE itself has so far refrained from commenting on the report. However, if Miller’s petition gains the necessary 100k signatures needed to require a parliamentary debate, the BOE might be forced to address the issue. Bailey is due to take over the role on March 16th.
FTSE (Bearish below 7025.8)
From a technical viewpoint. The FTSE has broken below both the monthly pivot at 7403 and the yearly pivot at 7300 and now also through the 7025.8 level support. Unless price can make it back above that level, the yearly S1 at 6856.6 is the next downside level to watch.
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