Bank of England governor Mark Carney warns Theresa May not to tell him how to do his job

Governor of Bank of England, Mark Carney

'We are not going to take instruction on our policies from the political side'

The Governor of the Bank of England (BoE) has told Theresa May not to tell him how to do his job.

Mark Carney said he would not take instruction from politicians on how the BoE Monetary Policy Committee determines interest rates.

The comments appear to be a response to the Prime Minister’s criticism of the independent central bank's policies during her party conference speech.

Ms May had claimed the BoE’s low interest rate policy had "some bad side effects" on pensioners, savers and the young. 

Mr Carney was clear that although the overall objectives are set by politicians, the decisions on how to achieve them are made by the bank.

"Politicians have done a very good job of setting up the system. Where it can be difficult, sometimes, is if there are political comments on our policies as opposed to political comments on our objectives,” Mr Carney said at a public meeting in Birmingham, Reuters reported. 

"The objectives are what are set by the politicians; the policies are done by technocrats. We are not going to take instruction on our policies from the political side." 

Ms May had also warned against quantitative easing – essentially printing money – and a further interest rate cut.

The Governor is thought to have complained to Chancellor Phillip Hammond about the remarks, who advised Ms May to not threaten the independence of the BoE, according to the Daily Mail. 

A Downing Street spokesperson said: “Monetary policy - including quantitative easing - is a matter for the independent Bank of England. That remains the case.

“The change is that Theresa May will put her government at the service of those who have found themselves poorer as a result of monetary policy.”