Negative rates have a limited effect on financial conditions – Catherine Mann

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“Asset prices provide important information on the transmission of monetary policy to the real economy and inflation,” he said. Catherine Mann, the newest member of the Bank of England’s Monetary Policy Committee, on Monday.

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“Asset prices and their relationship to financial stability are also important for monetary policy considerations.”

“The effectiveness of unconventional monetary policies, such as quantitative easing and negative interest rates, is highly dependent on national and global economic growth and the policy environment.”

“The US research showed that state-dependent future guidance was the tool most associated with better financial conditions.”

“With respect to negative interest rates, this tool was generally implemented after other tools, so the marginal effect on financial conditions was limited.”

“As long as inflation does not skyrocket, a positive inflation premium in longer duration stocks is consistent with a positive economic climate and not a negative signal for the markets.

Market reaction

The pair GBP/USD It continues to push lower after these comments and was last seen shedding 0.75% on the day at 1.3670.

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