US spillovers might increase need for UK easing, says Hélène Rey
Andrew Bailey says policy will be “state contingent” but negative rates are possible
The Biden administration’s $1.9 trillion stimulus is likely to trigger spillovers worldwide and could strengthen the case for the Bank of England to ease policy further, Hélène Rey said on March 8.
Rey, a professor of economics at the London Business School, noted that US policy tends to impact global financial conditions through the dollar’s role as the global reserve currency. The US yield curve is already steepening as a result of the stimulus measure, which may reflect investors’
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