The Bank of England left its base interest rate unchanged at 4.00% and announced a slowdown in its quantitative tightening programme to reduce strain on volatile gilt markets. The decision was communicated in a press release and matched market expectations.

Members of the monetary policy committee voted 7–2 to cut the annual pace of gilt sales from roughly £100bn to £70bn. The BoE said it will shift sales away from longer-dated gilts toward shorter-dated ones in response to recent rises in yields, notably on UK and French government bonds. The move is the first reduction in the pace of balance-sheet runoff since 2022; the bank bought about £875bn of gilts between 2009 and 2021.

"The new target means the committee can continue to reduce the size of the bank's balance sheet in line with the objectives of its monetary policy while minimising the impact of market conditions on the gilt market," said Governor Andrew Bailey. #BankofEngland #BoE #AndrewBailey #gilts #UK #FiatNews