Bank of England to Slow Quantitative Tightening on $754 Billion Bonds After £750 Million Gilt Sale with 18% Loss

The Bank of England is expected to slow the pace of its quantitative tightening (QT) program, which involves shrinking its $754 billion holdings of UK government bonds. This adjustment comes amid a recent rise in bond yields. Economists anticipate that upcoming announcements will provide more clarity on the Bank's longer-term strategy for managing its bond stockpile. Recently, the Bank sold approximately £750 million in UK government bonds maturing between 2037 and 2040, including a notable sale of 2037 bonds that incurred an 18% loss. The gilt sale had a cover ratio of 2.65, reflecting demand relative to the amount offered.