The pound has strengthened slightly against the euro and the dollar this morning, despite signals that the Bank of England could introduce negative interest rates at their February meeting. BoE official, Silvia Tenreyro implied in a speech yesterday that she would be in favour of cutting rates. She said, “Negative interest rates should, with high likelihood, boost UK growth and inflation.”
Speeches from more officials throughout the course of this week should reveal the Bank’s intentions further. Tenreyro also said that they were talking to banks and other institutions about how negative interest rates would impact them.
Cutting interest rates could also depend on the progress of the vaccination programme, which the government set their plans out for yesterday. They hope that everyone in the most vulnerable categories will be vaccinated by February 15.
