- The Bank of England's balance sheet has already stopped shrinking, ending the run-down that defined its post-2022 quantitative tightening program.
- The halt in balance-sheet reduction shifts the BoE's policy mix: rate decisions become the primary tightening or easing lever, with active gilt sales no longer draining duration from the market.
- A stable BoE balance sheet removes a persistent supply pressure on UK gilts, a backdrop that favors duration-sensitive UK assets over the medium term.
Quotes
“The Bank of England’s balance sheet has already stopped shrinking”