BizNomic

The U.K. Treasury appointed Martin Weale to serve on the Bank of England’s nine-member interest rate-setting Monetary Policy Committee as it begins to split over how soon to exit its emergency stimulus measures.

Weale, who is currently director of the National Institute for Economic and Social Research in London, replaces Kate Barker, whose term on the panel ended May 31. The appointment will take effect in time for Weale to participate in the August rate decision, the Treasury said in an e-mailed statement.

NIESR is most familiar to investors and traders through its monthly estimates of the quarter-on-quarter rate of GDP growth, which Mr. Weale produces. In June, NIESR estimated that in the three months to May, output was up 0.7% from the three months of February.

“Obviously we hope that the rate of growth will improve further but there are a number of factors which will impede growth in the coming months,” Mr. Weale wrote. “One is that the euro area may be adversely affected by the spill-over from Greece’s debt crisis. Secondly, the United Kingdom has recently lost competitiveness against the euro area as sterling has risen. Thirdly, there are risks of renewed weakness to domestic demand as the UK’s fiscal deficit is corrected.”

As a member of The Times newspaper’s shadow Monetary Policy Committee, Weale voted last month for no change in rates or the 200 billion-pound ($302 billion) limit on quantitative easing, the newspaper said June 10. He said that although inflation was a concern, it was offset by the risks to economic growth from the weaker euro and the Greek crisis, according to The Times.

“Obviously I’m looking forward to the opportunity but I’m not in a position to comment on the state of the economy,” said Weale in a telephone interview today.

Weale has run the London-based institute since 1995 and also worked as an adviser to the Office for National Statistics. NIESR’s clients include the Bank of England and the Treasury. A graduate of Cambridge University, he was a fellow at the Bank of England for a year in the mid-1980s and has also been a visiting scholar at the Federal Reserve Bank of Minneapolis.

Weale’s experience “of economic forecasting and data analysis derived from 15 years as director of the National Institute for Economic and Social Research will be extremely valuable to the committee,” said Chancellor of the Exchequer George Osborne, in a statement.