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Sept. 22, 2020, 5:54 a.m. EDT

Pound moves off lows after Bailey dampens negative interest-rate speculation

By Steve Goldstein

The pound moved off its lows on Tuesday as the Bank of England governor said the central bank wasn’t about to deploy negative interest rates imminently.

Trading as low as $1.2717, the pound (XTUP:GBPUSD) moved to $1.2799 vs. $1.2815 on Monday.

Bank of England Governor Andrew Bailey separately said that while the monetary policy committee “looked hard” at the potential to cut rates further, it didn’t imply the central bank would use negative interest rates.

Minutes from the last meeting stated the central bank was studying how negative interest rates could be used effectively, and there would be “structured engagement” on the operational considerations in the fourth quarter.

Ahead of Boris Johnson’s address to parliament , the prime minister’s office said starting on Thursday, pubs, bars and other hospitality venues in England will be restricted to table service only and will have to close at 10 p.m. Michael Gove, minister for the Cabinet Office, said Brits would be encouraged, but not forced, to work from home.

The FTSE 100 (FTSE:UK:UKX) did advance, gaining 0.4% after Monday’s 3.4% retreat, which was the worst since June 11.

Whitbread (LON:UK:WTB) , the Premier Inn owner, fell 3% as it said it would cut up to 6,000 jobs, or 18% of its workforce. Second-quarter ending Aug. 27 like-for-like sales slumped 75%.

Kingfisher UK:KGF , the owner of home-improvement chains, rose after reporting its first-half ending July 31 pretax profit rose to £398 million from £245 million, and that third-quarter like-for-like sales jumped 17%.

U.K. insurers, including Direct Line Insurance (LON:UK:DLG) , Hiscox (LON:UK:HSX) and RSA Insurance (LON:UK:RSA) , dropped after the Financial Conduct Authority proposed that when a customer renews their home or motor insurance policy, they pay no more than they would if they were new to their provider through the same sales channel, stamping out a practice called “price walking.”

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