Tax & Spend
Hunt May Net £10 Billion for Tax Cut if BOE Shifts on Asset Sales
- Letter from Governor Bailey to MPs reveals potential savings
- BOE decision in September when market expects first rate cut
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UK Chancellor Jeremy Hunt would have an extra £10 billion a year for tax cuts if the Bank of England stopped selling the bonds it bought over more than a decade under quantitative easing, according to BOE disclosures.
The UK central bank is winding down a portfolio of assets that reached £895 billion ($1.1 trillion) during its efforts to protect the economy from the pandemic and global financial crisis between 2009 and 2022. Most central banks are shrinking their QE portfolios, a process known as quantitative tightening, but the BOE is one of very few to be actively selling assets rather than simply letting them mature.