Eddie George

Eddie George was a British economist and banker who, as governor (1993–2003) of the Bank of England (BOE), guided the British central bank to independence and thus full control over the country’s monetary policy.

After studying economics at Emmanuel College, Cambridge, George served briefly in the Royal Air Force. He joined the Bank of England in 1962 and worked mainly in its international section. He also worked at the Bank for International Settlements in the mid-1960s and the International Monetary Fund (IMF) in the early 1970s. George was promoted to executive director of the Bank of England in 1982 and to deputy governor in 1990.

In 1991, as deputy governor, George faced criticism for his role in the collapse of the Bank of Credit and Commerce International. An official inquiry uncovered a series of failures in the Bank of England’s systems of supervision and communication. George restored his reputation through his adept handling of the United Kingdom’s embarrassing withdrawal from the European Communities’ exchange-rate mechanism in September 1992. Withdrawal—which amounted to a forced devaluation of the pound sterling—was a political disaster for the Conservative government, but George managed the technical side of the crisis with consummate skill.

His reward was promotion to governor of the Bank of England in July 1993. In that position he lost no opportunity to expound his view that the United Kingdom’s economy could sustain more rapid growth only if inflation were held in check by keeping interest rates high. Determined to retain his post, George was more forthright in his public statements than his predecessors were; he was candid both about general economic policy and about his differences with the United Kingdom’s chancellor of the Exchequer, Kenneth Clarke. In 1995 a decision to start publishing minutes of George’s monthly meetings with Clarke revealed the scale of a debate about interest rates within the Conservative government. By the end of 1995, as signs of an economic slowdown became clear, George acknowledged that Clarke had been right to overrule him and hold rates down. This setback did not deter George from his longer-term aim of securing full independence for the Bank of England along the lines of Germany’s Bundesbank, a goal that he achieved in 1997.

George retired in 2003 at the end of his second five-year term. He was knighted in 2000 and was made a life peer in 2004.