BOE Gilt Relief Is a Day Late, a Pound Short: Marcus Ashworth

It’s not quite the Bank of England’s unconditional surrender. But the central bank’s decision to step back from competing with the government in the gilt market - by reducing sales of long-dated bonds from its inventory - represents an acknowledgment of the damage it’s done to public finances.

With inflation near 4% and interest-rate cuts off the table for the near future, the biggest impact the central bank could have on the sputtering economy is to bring down bond yields at the long end of the curve, which have soared during the past year even as the policymakers trimmed their ...