In order to stabilise the country's financial pulse, the Bank of England has an open offer to buy back, at auction and at a realistic prize, long-dated Government bonds. It said it was prepared to go up to £5bn a day, each working day til 14th October. If fully taken up, that would mean 'printing' sterling to a total of £65bn. The Bank's Chief Economist, Huw Pill claims "These operations do not create central bank money on a lasting basis".
The BoE bought £1.025 billion of gilts out of £2.587 billion offered in its first buy-back on Wednesday, rejecting offers it thought were priced too high. On Thursday, it bought £1.415bn. Today's half-hour auction starts at 2.15pm. As recently as 22 September, the Bank had intended to launch a sell-off of gilts, aiming for £80bn over the next twelve months.
No comments:
Post a Comment