Whitbread to cut 6,000 jobs; Bank of England cools negative rates talk – business live | Business
Speaking at a British Chambers of Commerce virtual event, Bailey said the Bank was ready to do everything it could to support the economy but played down expectations it could use negative interest rates to protect jobs and growth.
Used by other central banks around the world, including the European Central Bank and the Bank of Japan, to stimulate growth, negative rates involve central banks charging commercial banks interest on their deposits, with the aim of encouraging lending to businesses and households.
Bailey said the use of negative rates around the world had achieved “mixed” results and that the effectiveness of the policy depended on the timing of the move and the structure of a country’s banking system.
While saying the policy remained in the Bank’s toolbox for tackling a more severe downturn, he cooled expectations that the policy could be used soon. Threadneedle Street had suggested last week that it could cut interest rates to below zero next year, after officials said preparations were under way to allow the central bank to support the economy with lower borrowing costs.