Andy Haldane said that pushing interest rates to below zero, as well as buying riskier assets under the central bank’s bond-purchase programme, could not be ruled out.

In an interview with The Sunday Telegraph, he said: “The economy is weaker than a year ago….so in that sense it’s something we’ll need to look at — are looking at — with somewhat greater immediacy. How could we not be?”

The comments will increase speculation over what would be an unprecedented move for the Bank. Interest rates currently stand at 0.1% after the bank cut the rate from the already reduced 0.75% on March 11.  This marks the lowest level of interest rates in their 326-year history.

Negative interest rates effectively see banks charged to hold their money at their country’s central bank and are an attempt to spur economic activity, The Times reports. 

Mr Haldane’s suggestion follows an attempt by the bank’s governor Andrew Bailey, to play down the prospect of negative rates. He said last week that the rate cut was “not something we are currently planning for or contemplating.” However, he said it would be unwise to rule anything out, “particularly in these circumstances”.

Similarly, Ben Broadbent, the bank’s deputy governor, has said the pros and cons of what would be a drastic and historic measure needed to be considered.

Negative interest rates have been implemented by the European Central Bank as well as in Sweden, Switzerland, Denmark and Japan in recent years.

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