LONDON, April 30 (Reuters) - A policymaker who is due to become the Bank of England’s chief economist said prices of assets - such as houses - had more impact on the dynamics of an economy than is commonly understood.
Asked by lawmakers about how monetary policy should react to asset price bubbles, Andy Haldane said financial factors, particularly asset prices, played a more central role in an economy than was typically reflected in macro-economic models.
Haldane is due to leave his current role at the Bank in overseeing potential risks to the economy from the banking sector and will become chief economist in June. He will take a seat on the BoE’s rate-setting committee. (Reporting by David Milliken and Huw Jones; writing by William Schomberg)