–BOE Accepts Offers For All of the 9 Gilts On Offer
LONDON (MNI) – The Bank of England over 25 year reverse gilt
auction was barely covered on Tuesday.
The cover ratio at Tuesday’s auction was just 1.06, down from 1.39
cover in last week’s corresponding auction and as low as the BOE has
seen in conducting quantitative easing.
Cover tends to be much lower at the ultra long end of the spectrum,
with pension funds needing long gilts for asset/liability matching and
banks needing them for capital adequacy reasons, which pushes down on
supply. The 3 to 10 year auction on Oct 17, for example, had a 4.47
cover ratio.
The central bank accepted offers for all of the nine gilts on
offer.
–London newsroom 0044 20 7862 7491; email: drobinson@marketnews.com
[TOPICS: M$B$$$,M$$BE$,MMBBE$]
