Hints of 0% interest from the Bank of England:
Bank of England governor Mervyn King said he was ready to reduce rates to ‘whatever level is necessary’ to counter the economic storm.
That could mean interest rates being slashed to zero for the first time as the Bank of England battles the deepening recession.
Mr King warned Britain’s economy could shrink by at least 2 per cent during 2009, pushing inflation into negative territory for the first time in almost half a century.
As Stephen Green notes this is a sign that the Bank of England is in panic mode and pretty much has no idea what the heck to do next.
That ain’t good.
