BoE: Negative rates may have less desirable consequences

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“Negative interest rates may have less desirable consequences, depending on the state of the economy and the financial system,” he said on Friday. the deputy governor of the Bank of England (BoE), Dave Ramsden.

Additional conclusions

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“Whether you benefit from negative rates will depend on the state.”

“The key problem with negative rate pass-through is that deposit rates don’t usually go down, especially for retail clients.”

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“Negative rates are a particular problem for UK banks and mortgage companies.”

“Different people at MPC will view negative rate evidence differently.”

“There is no question at the moment that the Bank of England is using negative rates.”

“It is right for the Bank of England to broaden its policy toolkit, decide how and when we want to consider negative rates.”

“We have the potential problem of false sunrises in UK economic data, this means we need solid evidence before we tighten up the policy.”

Market reaction

The pair GBP/USD It showed no immediate reaction to these comments and was last seen rising 0.15% on the day to 1.3690.

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