The Bank of England has said it will consider the case for negative interest rates if the economic outlook worsens in the UK, due to the coronavirus crisis.

Commenting on the announcement, Nisha Vaidya, mortgage expert at Bankrate UK, said: “In more normal times, it would be unprecedented for the Bank of England to consider cutting interest rates below zero. However, in the current climate it’s unfortunately not surprising. In terms of the impact of negative rates on consumers’ personal finances, the picture is very mixed. Mortgage borrowers may feel the benefit as variable rates track lower, but it’s unlikely to make much of a difference to those potential first time buyers who are struggling to get a mortgage. High house prices and tighter lending criteria are pricing many people out of the property market, regardless of the current situation with interest rates.

“For savers, the prospect of negative rates is just more bad news following years of low interest rates. The feared scenario of banks charging people to hold their money for them is unlikely to happen, but having seen rates drop to a historic low of 0.1%, savers should brace for the very real possibility that rates could sink even lower.”