Desi boy Sushil Wadhwani appointed to Bank Of England's Monetary Policy committee.
Ratan:
How'bout that a desi boy to help make England's monetary policy,love it.<g>
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Monday April 26, 3:00 pm Eastern Time
FOCUS-Wadhwani to replace Budd on BoE's MPC
(adds background, economist reaction)
By Ashley Seager
WASHINGTON, April 26 (Reuters) - Britain's Chancellor of the Exchequer Gordon Brown said on Monday he had appointed hedge fund manager Sushil Wadhwani to the Bank of England's Monetary Policy Committee, which sets British interest rates.
Wadhwani, a respected academic and partner of hedge fund group Tudor Proprietary Trading, will replace Alan Budd as one of the four ''outside'' members of the nine-member body. Budd is the first to leave the MPC in its two-year history.
Brown also said the Bank had reappointed Ian Plenderleith, its director of market operations, to the MPC for a further three-year term.
''I am delighted that Sushil Wadhwani has agreed to join the Monetary Policy Committee. He will not only bring recognised expertise in the field of labour market economics, but also considerable experience of financial markets,'' said Brown, attending the spring meeting of the International Monetary Fund.
Economists were impressed by Wadhwani's appointment.
James Nixon, a research fellow at the London Business School, said he was one of the most renowned and talented economists of his generation.
''Getting him into the MPC is a really big coup for the Labour party,'' Nixon said. "He's a player in academia and in the financial markets. He'll bring to the MPC a degree of real world experience that others will find it hard to equal.
''He's hot, I wouldn't want to argue with him. He is Mr. Hedge Fund.''
Philip Shaw, economist at Investec Bank in London, agreed, adding Wadhwani was ''a great preacher of the overvalued stock market.''
''Apparently he thinks the stock market will come off and that policy makers will be left to clear up the debris,'' said Shaw.
Brown thanked Budd, who was chief economic adviser to the Treasury before joining the MPC at its inception two years ago, for his contribution to the MPC's work. Budd is moving on to be provost of Queen's College, Oxford and decided he could not do both jobs. He was well regarded by the Treasury.
''We would have been very happy if Alan had stayed but it was his decision to go,'' said a Bank official.
There had been rumours in financial markets that Budd had been unhappy with what he saw as political pressure on the MPC to reduce interest rates last year, which it has since done.
One of Brown's first actions on coming to power in May 1997 was to hand responsibility for setting interest rates to the newly formed MPC. The MPC began life with eight members but this was expanded to nine last year with the appointment of John Vickers as chief economist.
Budd was an ''outside'' member of the MPC appointed by the Chancellor after consultation with Bank Governor Eddie George.
Budd only took a one year appointment last June, while the other three took two- or three-year terms, the idea being that changes on the MPC are staggered to avoid disruption.
The positions of Willem Buiter and Charles Goodhart are up for review in June next year and that of DeAnne Julius in June 2001.
Of the Bank's five ''inside'' members of the committee, the Governor and his two deputies, Mervyn King and David Clementi, are appointed by the crown for five-year terms. George and King started these last June and Clementi in September 1997.
The other two insiders, Vickers and Plenderleith, were appointed by George after consultation with Brown.
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