LONDON (MNI) – The Bank of England saw cover of 3.41 at its Stg1
billion 7-15 year reverse gilt auction Wednesday, having seen cover of
only 1.89 at the corresponding auction on Sep 5.
Before the September 5 auction cover ratios tended to be strong at
the 7 to 15 year auctions. On Aug 29 the cover ratio was 3.25, on Aug 22
it was 3.29 and on Aug 15 it was 2.50 and this auction markes a return
to the more robust cover ratios.
The BOE is carrying out a stg50 billion tranche of quantitative
easing over four months, started in July, taking QE to a total stg375
billion. As at Sep 6 the BOE’s data showed it had completed Stg350.838
billion of QE and after this week’s three auctions the total rises to
some Stg353.8 billion, leaving the central bank with stg21.2 billion to
complete before the Monetary Policy Committee’s November meeting.
The BOE is currently purchasing stg3 billion of gilts a week in
three weekly auctions. Under the BOE’s programme gilts with a residual
maturity of 3-7 years are being purchased on Mondays, over 15 years on
Tuesdays and 7-15 years on Wednesdays.
-London newsroom 0044 20 7862 7491; email: drobinson@marketnews.com
[TOPICS: M$$BE$]
