LONDON (Reuters) – The Bank of England allotted 16.245 billion pounds ($20.64 billion) of one-week funds in its short-term repo operation on Thursday, the largest usage of the facility since it launched in October 2022 after previous records were set in recent weeks.
The BoE uses the weekly repo to help keep money market rates close to its official Bank Rate while it takes reserves out of the financial system with its quantitative tightening (QT) programme.
Under QT, the BoE is selling a large chunk of the government bonds that it bought over the past 15 years via its quantitative easing programme, and allowing others to mature.
BoE Governor Andrew Bailey said on Tuesday the recent increase in the use of the short-term repo facility was encouraging and showed the benefits of having “tried and tested” liquidity facilities as the central bank ran down its balance sheet.
(Writing by William Schomberg; editing by Sarah Young)
Comments