Bank of England eyes sub-zero rates in face of virus, Brexit

Thu., September 17, 2020, 9:51 a.m. CDT

Thu., September 17, 2020, 9:51 a.m. CDT

LONDON — The Bank of England indicated Thursday that it could cut interest rates below zero for the first time in its 326-year history as it tries to shore up a U.K. economic recovery that is facing the dual headwinds of the coronavirus and Brexit.

After unanimously deciding to maintain the bank’s main interest rate at the record low of 0.1%, the nine-member rate-setting Monetary Policy Committee said it had discussed its “policy toolkit, and the effectiveness of negative policy rates in particular.”

In minutes accompanying the decision, the rate-setters said a recent wave of virus infections has “the potential to weigh further on economic activity, albeit probably on a lesser scale than seen earlier in the year.”

Though the committee noted that recent economic data have been a “little stronger than expected” at its last meeting in early August, it said it is unclear what that says about the future “given the risks.”

READ MORE HERE: https://ca.finance.yahoo.com/news/bank-england-says-economic-outlook-111515858.html

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