Bank of England (BOE) Deputy Governor Dave Ramsden testified to UK lawmakers that the bank is ready to increase the speed and size of its bond-buying programme if necessary. This comes just weeks after Bank of England Governor Andrew Bailey said the bank is considering all measures to support the UK economy, including negative interest rates.
Bank officials are particularly worried about the triple threat facing the UK economy this year which includes:
- The potential of a resurgent coronavirus
- Potential mass unemployment from the end of the UK furlough scheme, and;
- An uncertain Brexit deal or no-deal outcome
In a statement to lawmakers, the bank admitted that the uncertainty in their forecasts is the largest ever. No new forecasts are likely until November. The UK faced the worst economic impact of all major economies this year but the British pound has performed well since its March lows.
In the last few weeks, the British pound against the US dollar surged to a new high for 2020 before pulling back on broader US dollar strength, setting up the potential for some major swings in the next few months. How will you be trading it?
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