Treasury appoints new rate setter

Mr Miles has taken a keen interest in the UK mortgage market

The Treasury has appointed economist David Miles to the Bank of England's interest-rate setting committee.

Mr Miles, who currently works at financial services firm Morgan Stanley, will replace David Blanchflower.

Mr Blanchflower often defied the consensus on the nine-strong Monetary Policy Committee (MPC), consistently favouring lower rates.

However, his view has been vindicated with the cost of borrowing in the UK now at its lowest in 300 years.

Mr Miles, who has also held a number of academic posts, will take up his position on June 1.

Mr Miles has been particularly concerned with the effects of the financial crisis on the mortgage market.

In 2003, he wrote a government report that suggested that people should be encouraged to take fixed, rather than variable, rate mortgages in order to promote financial stability.

MPC member Tim Besley also said he would leave the committee when his term expires in August.

The Treasury said it would begin looking a replacement.