Ramsden sets multi-year QT path to unwind gilt stock by 2034
Bank of England Deputy Governor Dave Ramsden detailed the framework to fully unwind the Asset Purchase Facility by 2034. The multi-year plan establishes fixed annual gilt sales of £20 billion alongside bond maturities to conclude the programme.
A ten-year roadmap for £488 billion
The Bank of England plans to fully unwind the remaining £488 billion in Asset Purchase Facility gilts by late 2034.
Under the multi-year framework, the Monetary Policy Committee agreed to sell £146 billion of bonds across 2035 to 2049 maturities at a fixed pace of £20 billion annually.
A further £222 billion will roll off passively as bonds reach maturity, while £120 billion of long-dated gilts will remain to back banknote issuance rather than serve monetary policy goals.
The Bank Executive intends to conduct the £146 billion in sales directly to the Debt Management Office rather than via market auctions, returning the state to a single public seller.
Balancing rate holds and auction discipline
Ramsden noted that Bank Rate remains the primary monetary lever, confirming his vote with the 6-3 majority to hold rates at 3.75 percent in September.
He cautioned that inflation risks tilt to the upside due to energy volatility, weather shocks, and supply chain pressures.
Past quantitative tightening contributed an estimated 20 to 30 basis points to ten-year gilt yields since 2022.
The new sales schedule will only pause under severe market distress or if Bank Rate hits the lower bound.
Predictability over market timing
Locking in a fixed path eliminates annual market speculation and puts balance sheet runoff on autopilot.
Selling directly to the Debt Management Office neatly removes auction friction while streamlining public debt issuance.
The rigid timeline provides welcome certainty, even if it constrains tactical flexibility during future shocks.