BOE's Quantitative Tightening Overhaul Should Support Gilts
Dow Jones09-18 21:39
1339 GMT - The Bank of England on Thursday announced significant changes to its quantitative tightening program, or the process of shrinking its gilt holdings, a positive development for the gilt market, analysts at BNP Paribas say in a note. The pause of active gilt sales until April, reduces gilt supply, they say. The BOE's plan to sell 20 billion pounds in gilts to the Debt Management Office, annually until 2034, makes gilt supply more predictable and reduces uncertainty, the analysts say. Gilt yields fell after the BOE announcement, but they are up on Friday after stronger-than-expected retail sales data and in line with rising yields globally. Ten-year gilt yields climb 7.3 basis points to 5.291%, Tradeweb data show.
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