BOE's Ramsden: It is reasonable to have an open mind on negative rates
Comments by BOE deputy governor, Dave Ramsden, in a Reuters interview
- But it is a very complex issue
- Says BOE comments are not main driver of negative Gilt yields
- There is plenty of headroom for more QE purchases
- It is quite possible BOE will do more QE at June meeting, or subsequent ones
- Markets are in a better place than they were, but still fragile
- BOE was very clear in May statement there are downside risks to virus recovery
- It is clear that UK economic upturn will be less sharp than downturn
A timely comment by Ramsden as UK 2-year yields open at a new record low of -0.08% to start the session. Once again, the BOE isn't exactly ruling out negative rates as they continue to float the idea before expanding QE purchases next month.
Cable is holding at the lows for the day now, around 1.2201 as buyers are still looking to hang on to the 1.2200 handle for the time being. The low yesterday touched 1.2186 so be wary of that near-term support level as well.