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Might be secretly worried about the relatively strong currency.
Many of them still think rates matter for the level of their currency even though the BOE research says they don’t matter.
> (email exchange)
> On Tue, Sep 15, 2009 at 5:34 AM, Dave wrote:
> BOE King states that BoE will look at reducing deposit rate on reserves
> Front end rallies, 1*1 at 2.565% currently, had traded as high as 2.68%
> prior to announcement
- KING SAYS LOWER RATE COULD MEAN MORE BUYING OF S-TERM GILTS
- KING SAYS IT MAYBE A USEFUL SUPPLEMENT, WON’T BE MAJOR CHANGE
- KING SAYS BOE WILL REFLECT ON LOWERING DEPOSIT RATE
- KING SAYS YOU COULD HAVE LOWER REMUNERATION RATE FOR RESERVES
- KING SAYS BOE IS LOOKING AT REDUCING DEPOSIT RATE FOR RESERVES
- KING SAYS THERE’S LIMIT TO HOW FAR BOE CAN GO ON RESERVES
- KING SAYS BOE DOESN’T WANT RESERVES UNNECESSARILY HIGH
- KING SAYS ASSET PURCHASES AUTOMATICALLY RAISE BANK RESERVES