MNI BRIEF: BOE Bailey: Sensible To Have Negative Option

The impact of cutting the policy rate into negative territory was far less clear than the impact of cutting it when the rate remains positive but it would be "sensible to have the ability to set negative interest rates," Bank of England Governor Andrew Bailey said Wednesday.

Speaking at a Citizens Panel event Bailey gave an even-handed summary of the case for negative rates . He said "We do not know with any confidence how that (cutting to negative) will work" but that other central banks had done it and "the evidence suggests it can work in some circumstances." The BOE is set to release the findings of its consultation with banks on negative rates alongside the February Monetary Policy Report.