BoE's King gets high rating but no economic stimulus as leaving gift
Economists reckon outgoing Bank of England Governor Mervyn King did a relatively good job in very trying times during a decade in office but he will not get his wish to leave with a new burst of stimulus for the economy.
A Reuters poll of around 70 economists, taken this week, did not predict any change to the Bank's now-dormant 375 billion pound asset purchase program when King chairs the Monetary Policy Committee for the final time on June 6.
The outgoing governor has been arguing for renewing purchases.
The chances of any more money printing this year, however, is more up in the air. The median likelihood of an increase this year has fallen in recent polls and now stands at 48 percent. But the total spend on quantitative easing is still seen at 400 billion pounds ($605 billion) as some economists expect more next year.
"The June MPC meeting is Mervyn King's swansong, but he is unlikely to get his apparent parting wish for more monetary stimulus to try and help UK economic recovery gain traction," said Howard Archer at IHS Global Insight.
Britain's economy has essentially flatlined for most of the last two years, narrowly avoiding an unprecedented triple-dip recession, and will eke out tepid growth at best through next year.
King, knighted by the Queen in 2011, had faced heaps of criticism for a slow response to the financial crisis.
But economists in the poll gave him a median score of seven out of 10 for his performance during his tenure.
"King has generally reacted well to circumstances in the last five years, despite a slow start," said Peter Dixon at Commerzbank.
Canadian Central Banker Mark Carney will replace him. His enthusiasm for bond purchases is not known but many of the poll's respondents expect him to give markets forward steers as to where policy will go.
"Forward guidance is on the way. The Fed has shown that you can operate forward guidance within an inflation targeting regime and I think it is a good thing," said Michael Saunders at Citi.
The United States Federal Reserve uses direction on policy as one its tools, as does the Bank of Canada. Forward guidance about the future path of interest rates can have a strong impact on current borrowing costs.
The BoE is tasked with keeping inflation at 2 percent - something it has failed to do since late 2009 - but as in recent polls it is not seen shifting rates from the record low of 0.5 percent they were chopped to four years ago until at least 2015 - the end of the forecast horizon.
Only eight of the 68 economists polled see any movement in rates before then.
($1 = 0.6616 British pounds)
(Polling by Shaloo Shrivastava; Editing by Jeremy Gaunt)