Bank of England scraps long-end gilt sales in major QE unwind overhaul

The Bank of England just redrew the map for how it plans to shrink one of the largest central bank balance sheets in the developed world. The MPC unanimously voted to stop selling long-dated gilts entirely, shifting its active sales program toward shorter and medium-maturity bonds as part of a restructured quantitative tightening timeline stretching to September 2034. The numbers behind the unwind The remaining gilt stock earmarked for disposal sits at roughly £368 billion. That figure comes from the overall Asset Purchase Facility holdings of around £488 billion, minus approximately £120 billion reserved as backing for banknotes. The MPC set an average annual reduction target of £46 billion. Of that, £20 billion per year will come from active sales in the open market, with the remaining £26 billion arriving passively as bonds mature and roll off the balance sheet. Over the full unwind horizon, the math breaks down like this: £222 billion of the £368 billion will mature naturally, while £146 billion will need to be sold outright. No long-dated gilt auctions are scheduled for the third quarter of 2026. To put the scale in perspective, the APF’s gilt holdings peaked at nearly £895 bi...