Negative interest rates: Bank of England policymaker defends plan

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Silvana Tenreyro told the Sunday Telegraph that evidence from other countries was “encouraging”.

On Tuesday, the BoE governor played down the prospect of taking rates below zero, insisting it just needed to make sure it could do so if needed.

The Bank has so far responded to the pandemic by cutting rates to just 0.1%.

If interest rates are negative, the BoE charges for any deposits it holds on behalf of the banks. That encourages banks to lend the money to business rather than deposit it.

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