Home Uncategorized BoE’s Tenreyro says removing policy support too early could be costly

BoE’s Tenreyro says removing policy support too early could be costly

4 min read

BoE's Tenreyro says removing policy support too early could be costly
© Reuters. FILE PHOTO: A general view of the Bank of England in the City of London financial district, London, Britain

LONDON (Reuters) – Bank of England interest rate-setter Silvana Tenreyro said removing fiscal or monetary policy support for the economy too early after last year’s coronavirus slump could have a damaging effect on the labour market.

“One lesson that we learned from the financial crisis is that withdrawing policy support too early can be very costly,” Tenreyro said in an online discussion hosted by Swedish think tank SNS.

“Withdrawing it too early … can lead to scarring effects on the labour market that would be very costly and slow down growth going forward,” she added.

The BoE last year cut rates to a record low of 0.1% and doubled the size of its bond-buying programme to 895 billion pounds ($1.23 trillion). Tenreyro argued in late 2020 that the economy might benefit from cutting rates below zero.

Since then, Britain has made fast progress with its COVID-19 vaccination programme, raising the prospect of a bounce-back for the economy this year and in 2022.

Tenreyro said it was not yet clear whether Brexit had given Britain an advantage with its vaccination programme, which it has rolled out faster than countries in the European Union.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

BoE’s Tenreyro says removing policy support too early could be costly

Load More Related Articles
Load More By Money Bulletins
Load More In Uncategorized

Leave a Reply

Your email address will not be published. Required fields are marked *

Check Also

Canadian Pacific welcomes STB’s approval of merger with Kansas City

2/2 © Reuters. The Canadian Pacific railyard is pictured in Port Coquitlam 2/2 (Reuters) &…