BOE’s Plans to Keep QT on Autopilot Upended by Market Reality

The Bank of England’s decision to slow the pace and change the make-up of its quantitative tightening plan on Thursday shattered any lingering illusion the policy remains on autopilot.

The BOE’s annual QT decision on Thursday saw officials reduce the annual run-off of their gilt holdings to £70 billion ($95 billion) from £100 billion. Bowing to recent volatility in long-dated gilts, the Monetary Policy Committee said the required £21 billion of active sales in the 12 months from October would be skewed away from those maturities.