Monetary Policy Committee member David Walton dies, aged 43

David Walton, the sole member of the Bank of England's Monetary Policy Committee to call for higher interest rates this year, has died unexpectedly. He was 43.

The former Goldman Sachs economist, who joined the MPC in July last year, died on Wednesday evening after a short illness, the Bank said yesterday.

Mervyn King, the Bank's governor, led the tributes saying Mr Walton had "inspired the respect and affection" of all his colleagues. "Today's news has come as a shock to us all, as it will to those who knew him in the City, where he made his reputation," Mr King said.

Gordon Brown, who as Chancellor appointed Mr Walton to the MPC, said he had been a "highly valuable" member of the committee. "David Walton made a great contribution to economics and economic policy making in this country and I am deeply saddened by his sudden and early death," he said. John McFall, the Labour MP who chairs the Commons Treasury Select Committee, said Mr Walton had been a valued adviser to his committee. "His intellectual contribution and intimate knowledge of the global financial system will be sorely missed," he said.

Diane Coyle, the managing director of Enlightenment Economics, who worked with Mr Walton at the Treasury in the mid-1980s, said he was an "ideal member of the MPC. He was also thoroughly enjoying it. The work was tailor-made for him, and he for the work. It's clear that in just a short time he'd made a real mark on the committee's discussions".

In the financial markets the pound fell and gilts rose as traders said it made a rate rise this year less likely. The Bank issued a statement after rumours started to circulate in the City.

Mr Walton's death leaves the MPC with seven members instead of the usual nine as the Treasury has yet to announce a replacement for Richard Lambert, who left to join the CBI in March.

Michael Fallon, the senior Conservative on the Treasury Select Committee, said Mr Walton's death has "reinforced the case for setting a time limit for announcing replacements. The Chancellor's lethargy is endangering policy-making. Vacancies should be filled within one month". The Treasury declined to comment on the replacement process for either of the men, although one Whitehall source described Mr Fallon's intervention as "opportunistic".

Jim O'Neill, head of global economic research at the bank, said: "As an economist, David was amongst the best. As a colleague and friend, he was an exceptional person, both professionally and personally. It was fitting he became a member of the MPC, of which he was rightly very proud."