Negative Interest is on the Bank of England's Agenda

Negative interest rate is on the Bank of England’s agenda. It will be discussed whether negative interest will be used for the economy suffering from the coronavirus epidemic.

Negative interest rate was on the agenda of the Bank of England. The Bank of England is preparing to negotiate whether to use negative interest rates for the economy, which has entered a troubled period due to the coronavirus epidemic that emerged in Wuhan, China and affected the whole world. For the first time since its foundation in 1694, today, the Bank of England will share the results of 160 detailed analyzes on how borrowing costs below zero might affect it. The issue of whether to use this policy previously implemented in the European Union and Japan is challenging for Central Bank Governor Andrew Bailey, who has been trying to save the economy that has had the worst performance of the year in the last 300 years. Economists, who made an assessment on the subject, stated that the bank will use negative interest as a tool, but this will not happen immediately. The Bank of England's next monetary policy decision and quarterly estimates will be published on February 4. Most economists surveyed last week expect interest rates to remain stable at the current level of 0.1 percent at least until 2023. Only one bank is waiting for a negative interest rate decision. The bond purchase program of the bank is at the level of 895 billion pounds. Dan Hanson of Bloomberg Economics said, "The report in question will likely include the difficulties of the sub-zero interest rate policy and will state that this is far away for now." Bailey assessed the UK economy, which performed above anticipated growth in November, as "companies are adapting to restrictions." Famous economist Andy Haldane stated that he expects the coronavirus vaccine developed as part of the fight against the epidemic to support a sharp recovery in the second quarter of this year. While there are concerns that negative interest rates will decrease the profits of commercial banks, Europe's 5-year negative interest experience also presses the profits of banks. Christian Swing, CEO of Deutsche Bank AG, said in a 2019 statement that negative interest rates are a disruption fort he financial system in the long-term.