The GBP has remained muted against the US dollar (Image: Getty)
Mr Vlieghe stated that the bank may need to slash interest rates almost all the way to down to zero in the event of a no-deal Brexit. He also added that it is not clear how long it would then take interest rates to rise once again. The BoE official stated: “On balance I think it is more likely that I would move to cut Bank Rate towards the effective lower bound of close to 0 per cent in the event of a no-deal scenario.
“It is highly uncertain when I would want to reserve these interest rate cuts.”
Meanwhile, the US dollar failed to push higher against Sterling despite Thursday’s stronger than expected inflation data.
The strong Consumer Price Index (CPI) data did little to curb expectations that the Federal Reserve will begin slashing interest rates as soon as the end of this month.