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Carney comments cool Bank of England speculation

Mark Carney, the Governor of The Bank of Canada, listens and answers questions during a press conference that followed a speech he delivered to the Greater Kitchener-Waterloo Chamber of Commerce in Kitchener-Waterloo, April 2, 2012.

Deborah Baic/The Globe and Mail

Bank of Canada Governor Mark Carney has ruled out ever running the Bank of England, disappointing punters who are betting the British government would be forced to turn to a former colony to find an adequate candidate to oversee its troubled financial industry.

The Financial Times reported in April that Mr. Carney had been approached to lead the Bank of England when the term of the current governor, Mervyn King, ends next year. Mr. Carney denied anything of the sort had occurred, but the rumour refused to die.

That's partly because Mr. Carney was less definitive on whether the prospect of taking over one of the world's oldest central banks held some appeal. The story had an air of plausibility because Mr. Carney has a British wife, and because he attended the University of Oxford and worked in London as a banker with Goldman Sachs Group Inc. Speculation gathered pace in recent weeks as evidence surfaced that the Bank of England did little to stop chronic abuse of the Libor, a global benchmark lending rate set in London. As head of the Financial Stability Board, an international body that oversees global financial regulation, Mr. Carney came to be seen by some as capable of restoring London's reputation as the world's leading banking centre. On Wednesday, Paddy Power, an online betting site, was giving six-to-one odds that Mr. Carney would be the next Bank of England governor, compared with 10 to one in mid-April.

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Those odds are about to become longer.

In an interview with the British Broadcasting Corp. in London on Wednesday, Mr. Carney stated clearly for the first time that he was not in the running to lead the Bank of England.

"I'm very focused on my post at the Bank of Canada and the Financial Stability Board, and I look forward to working with the new or the next governor of the Bank of England," Mr. Carney said, according to a transcript of his appearance on the BBC show Hardtalk.

The host followed up by asking whether that was a "no, or a never?" Mr. Carney replied, "It's both, it's both. How's that?"

Mr. Carney's interlocutor tried one more time: "It's never?" Mr. Carney: "Yes."

That could be enough to put an end to the Bank of England rumours, removing a distraction as Mr. Carney focuses on addressing the Libor scandal in his capacity as head of the Financial Stability Board, and timing an eventual interest-rate increase at home.

"Interest rates are one per cent in Canada, that's very low," Mr. Carney said in the interview.

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About the Author
Senior fellow at the Centre for International Governance Innovation

Kevin Carmichael is a senior fellow at the Centre for International Governance Innovation, based in Mumbai.Previously, he was Report on Business's correspondent in Washington. He has covered finance and economics for a decade, mostly as a reporter with Bloomberg News in Ottawa and Washington. A native of New Brunswick's Upper St. More


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