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Bank of England (BoE) Deputy Governor Sam Woods said on Thursday that the responses from banks showed that a zero bank rate would pose less of an operational challenge than a negative rate, as reported by Reuters.

“The Prudential Regulation Authority’s (PRA) will engage with banks on their development of short-term fixes to implement any sub-zero rates,” Woods added. “The majority of firms would need to make some changes to systems to implement a negative interest rate.”

Market reaction

The GBP/USD pair, which fell to a daily low of 1.3567 ahead of the BoE’s policy announcements, was last seen trading flat on the day at 1.3645.