Bailey's press conference:
- Outlook remains unusually uncertain for economy
- We will move to the future with multi-dimensional choices on what tools to use
- On negative rates, there are a range of views on MPC on how PRA should respond
- Economic outlook risks have become more two-sided
- It's not easy to reach a firm view on how much UK households will release savings built during the pandemic
- Don't take any signal from negative rate preparations
- Q4 GDP numbers have turned out stronger than expected
- My message to markets is don not read future MPC decisions based on toolbox moves
- We haven't talked about the lower limit for the reversal rate
- Bailey: It appears there is very high leverage among retail investors in the US and elsewhere
- Retail brokerage platforms have to be ready for margin calls
- We are now working on question of how we would structure a bond portfolio to achieve climate objectives
Gilt yields are above 1% for the first time since Nov and sterling is at the highs of the day.
Ramsden:
- We are very much on track to complete QE programme by year-end
- We do need to slow the pace of QE purchases at some point
There are a handful of hawkish takeaways from the Bank of England today. There's been a clear walk-back from negative rate talk as the economy weathers the pandemic better than anticipated.
