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No-Deal Brexit Could Lead to Negative BOE Rates, Citigroup Says
Negative interest rates may eventually become unavoidable in the U.K., especially if there is a no-deal Brexit at the end of the year, according to Christian Schulz, director of European research at Citigroup. The Bank of England would likely cut rates to -0.1% in the middle of 2021 if the U.K. leaves the European Union without a new trade deal in place, he said. While more bond-buying and fiscal stimulus would be the first lines of defense in that case, the economy would likely still need more of a boost. Monetary policy could have an important role to play during a big supply-chain disruption because fiscal policy ... (full story)