Home Forex News The Bank Of England Appears To Be Preparing To Join

The Bank Of England Appears To Be Preparing To Join

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The Bank of England appears to be preparing to join Europe and Japan in crossing the Rubicon of negative rates. The bank’s monetary policy committee is reported to be working on clearing certain obstacles to the implementation of negative interest rates in order to allow the BoE to cut further from its current 0.1% rate. The policy of negative rates, which has been rejected in the past by the BoE’s interest rate committee, appears to have finally found favour as one of the last arrows in the central bank’s proverbial quiver. The cuts are expected to come into effect in 2021, with the current rate set to be maintained for the rest of the year along with the bank’s current £745 billion quantitative easing programme.

Similarly, the ECB has also opted to maintain its current course. Interest rates are to remain unchanged for now, as will the central bank’s Pandemic Emergency Purchasing Programme (PEPP) at €1.35 trillion. It was recently announced that the ECB is due to review this bond-buying initiative, with analysts expecting a possible increase by the end of the year. The only other notable measure to be introduced has been a recent relaxation of leverage ratios for European banks that will free up a further €73 billion in the banking system.

TREND : WEAK BEARISH

Time                                      :           26/10/2020

Pivot                                     :          1.3062

Technical View                     :           LONG ABOVE 1.3082

Target                                   :           1.3102, 1.3121, 1.3171, 1.3215

Technical View                      :           SHORT BELOW 1.3042

Target                                   :           1.3022, 1.2987, 1.2953, 1.2893

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