More QE not necessarily BoE's first choice, Broadbent says

European Currency News

Reuters Staff

LONDON, Feb 5 (Reuters) - Buying more government bonds may not be the Bank of England’s first choice if it needs to provide further stimulus to Britain’s economy, Deputy Governor Ben Broadbent said on Friday, after the BoE asked banks to be prepared for negative rates.

Broadbent said in an interview with CNBC that he did not want technical barriers to stop the BoE from cutting interest rates below zero, if needed, in future.

Asked if asset purchases would be the policy the BoE would lean on most for future stimulus, Broadbent said: “No, I don’t think so necessarily. We have yet to take that decision. All these options remain open. We have not ranked them.”

“We want to ensure that at the very least it was not the technical feasibility of negative interest rates that might prevent their use. There are deeper issues ... about their effectiveness, but the technical feasibility should not be something that stands in the way of them,” he added. (Reporting by William Schomberg Writing by David Milliken)