Bank's Bean promoted as Spencer Dale gets his job

By Sumeet Desai and Matt Falloon

LONDON (Reuters) - Charlie Bean will be the new deputy governor for monetary policy at the Bank of England, the Treasury said on Thursday, and Spencer Dale will replace him as chief economist at the central bank.

Dale, 41, a senior economist at the Bank, has been on secondment to the U.S. Federal Reserve in Washington and will take up his new role on the nine-member Monetary Policy Committee from July. He is known for his work on creating the Bank of England's Quarterly Model (BEQM) of the economy which is used to make forecasts.

Bean, the chief economist since 2000, takes over from Rachel Lomax who is stepping down after 5 years in the role at the end of this month. The other deputy governor, John Gieve, announced on Wednesday he would quit in early 2009, following the government planning changes to his role.

The appointments come at a crucial time for the Bank Monetary Policy Committee, on which both the deputy governor and chief economist serve, as inflation is way above the central bank's target and growth is slowing.

Paul Tucker, currently the Bank's director for markets, is talked about as a contender for Gieve's job.

"By next spring, therefore, there could be a majority on the MPC whose career advancement owes a good deal to the governor," said Michael Hume, economist at Lehman Brothers.

"This is likely to tighten the governor's grip on the committee and may result in a more hawkish monetary policy stance, given Mervyn King's consistently hawkish voting record."

Bean's promotion had been widely expected. Reuters had reported earlier this month he would get the nod over Tucker.