LONDON (Reuters) – The Bank of England will stick to existing plans to sell British government bonds and the sharp falls in long-dated gilt prices in recent months have not changed its thinking, BoE Deputy Governor Dave Ramsden said on Thursday.
Some bond market analysts – including primary dealers of gilts – have speculated that drops in long-dated bond prices might force the BoE to adjust its programme of gilt sales, known as quantitative tightening.
They have said the BoE could choose to slow its sales of long-dated gilts and instead sell more short-dated ones to help ease selling pressure on the long-dated market.
Ramsden said this was not on the cards.
“These changes in yield curves don’t change that (the BoE’s plans) at all,” he said at a news conference after the BoE left interest rates on hold.
In September, the BoE’s Monetary Policy Committee voted to increase the pace at which it will cut its 750 billion-pound ($914 billion) stock of gilts to 100 billion pounds a year from October, up from 80 billion pounds.
“We want those operations to be as predictable as possible,” Ramsden said.
“We’ve set out our schedule of auctions for the rest of this year … and we’ll be sticking absolutely to that.”
($1 = 0.8203 pounds)
(Reporting by William Schomberg and Sarah Young, Writing by Kylie MacLellan and Andy Bruce; editing by William James)