Lenders would increase mortgage costs in response, says Building Societies Association chair
Cutting the UK’s official interest rate below zero would fail to boost Britain’s Covid-stricken economy because lenders would increase mortgage costs in response, the Bank of England has been told.
The leading representative of Britain’s building societies said high street lenders were not in a position to handle negative interest rates, had computer systems that were ill-equipped and that the move would be counterproductive for the British economy.