National to appoint Cullen as Reserve Bank Governor

I understand that later today National will be announcing that they are appointing Michael Cullen as Governor of the Reserve Bank.

Their initial plans to make him Chairman of a major state-owned enterprise were criticised for his lack of commercial experience. Hence they have shifted course and now plan to make him Reserve Bank Governor as that is normally filled by people with more of an academic than commercial background.

Some MPs have told me they opposed the appointment, when it was notified to Caucus yesterday, but no formal vote was held. His appointment is part of the Key’s strategy to appear magnamious in victory and use talent from all parties.

The dissenting MPs are worried that here could be a minor loss of credibility for National to appoint to such an important role, the man whose financial and economic policies they have criticised for the last decade. But the clinching argument was that as National has adopted so many of them, they may as well adopt their architect also.

It will be interesting to see whether the dollar rises or falls, once the appointment is confirmed.