LONDON (MNI) – Bank of England Monetary Policy Committee Member
David Miles has rejected the idea that the Bank’s programme of gilt
purchases could face supply constraints now or in the near future.
Speaking in an interview with CNBC television, Miles noted that
there were more gilts in the market now than when the BOE first started
buying bonds 3 years ago:
“Where we are right now is a situation where the conventional
outstanding stock of gilts that the bank could buy – the stock is
actually larger than it was when we started asset purchases back in
March 2009″.
“The creation of new gilts by the government has actually – net –
more than matched the pace of purchases by the Bank of England since we
started buying in the early part of 2009″.
“We are certainly not in a situation where anytime in the very near
future we have run out of bonds to buy,” he continued.
Miles also rejected ideas that BOE buying is distorting the UK
government bond markets:
“I am sure that clearly in principle we could get to that point –
my own judgement is that we are not close to that point now”.
Miles was one of two MPC members who backed stg75 billion of extra
QE at the February meeting of the committee. The majority opted for the
lesser amount of stg50 billion.
–London newsroom 0044 20 7862 7499; email: ukeditorial@marketnews.com
[TOPICS: M$$BE$,MT$$$$]
