Bank of Canada names Murray as a deputy governor

Fri Jan 4, 2008 1:54pm EST
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By Louise Egan

OTTAWA (Reuters) - The Bank of Canada named a veteran insider as a deputy governor on Friday, bringing on board an economist reputed to have strong international and exchange rate expertise in time for the bank's next interest rate decision.

John Murray, a Princeton University graduate who has been an advisor to the governor since 2000, joins the bank's six-person governing council immediately.

That means he will have a say in the bank's January 22 rate decision, the final one under the leadership of Governor David Dodge.

Dodge hands over the reins on February 1 to Mark Carney, a former Department of Finance official and Goldman Sachs banker.

Murray is well known to economists in both academic and market circles and is seen bringing specialized knowledge on exchange rate policy to the table at a time when the Canadian dollar's rise has led exporters to call for an easing of monetary policy.

"In terms of his specialization, he's got a lot of experience on international matters and the exchange rate in particular," said Doug Porter, deputy chief economist at BMO Capital Markets.

"I think that's his real strong suit and given the massive movement on the Canadian dollar over the past year, that obviously is an important focus of the bank's policy in the year ahead," he said.

The bank cut its overnight lending rate by one-quarter point on December 4 to 4.25 percent on expectations that Canada's economy would be hurt by the U.S. subprime mortgage crisis and financial market distress.   Continued...