Interest rates could be cut ‘more aggressively’ by Bank of England, says Andrew Bailey
THE Bank of England could be “more aggressive” in cutting interest rates, Governor Andrew Bailey has said.
He claimed that if inflation continues to be held in check then the Bank could “be more activist” in lowering rates.
The news will be a boost to borrowers and particularly the 1.6million homeowners who need to remortgage later this year.
Last month Mr Bailey had suggested the opposite when saying that interest rates would fall “gradually”.
Money markets now have a near 100 per cent bet that the Bank will cut rates from the current five per cent to 4.75 per cent at its meeting next month.
However, the Pound fell sharply yesterday — with its biggest one-day slump in 18 months — following Mr Bailey’s comments to The Guardian.
It slipped 1.08 per cent against the dollar to $1.31, while dropping by 0.96 per cent against the euro to €1.19.
Valentin Marinov, head of Group-of-10 FX strategy at Credit Agricole, said: “The best days of the pound rally may be behind us.”