Asset Purchase Facility: Gilt Sales – Market Notice 21 June 2024

Market Notice

At its September 2023 meeting, the MPC voted to reduce the stock of gilts held in the APF for monetary policy purposes by £100 billion over the period from October 2023 to September 2024, to a total of £658 billion.

The Bank set out in the consolidated APF gilt sales Market Notice published on 1 September 2022 that it would publish a quarterly schedule for the sales of gilts held in the APF for monetary policy purposes. The details and schedule for the Q3 2024 sales of such gilts are set out in this Market Notice, which covers the period from 1 July 2024 to the week commencing 30 September 2024. 

As set out in the 15 December 2023 Market Notice, the Bank will set a schedule of auctions in order to continue to reduce the APF as evenly as possible across maturity sectors, measured in initial proceeds terms. These sectors are defined as gilts with a residual maturity of between: 3-7 years (short), 7-20 years (medium) and over 20 years (long). 

Accordingly, in Q3 2024, the Bank will sell short maturity sector bonds across four auctions of £800 million, medium maturity sector bonds across four auctions of £725 million, and long maturity sector bonds across two auctions of £650 million. Further details are outlined in the table below. 

As this is the final quarter of the period over which the MPC’s £100 billion target set in September 2023 applies, it may be necessary for the Bank to make some adjustment to the sizes of the final three auctions. If any adjustment is required, the Bank will provide the market with advance notice in a similar way to the Market Notice of 1 September 2023.

Other than as amended in this Market Notice, the detailed operational parameters and participation requirements set out previously will apply to these gilt sales. 

The Bank will continue to monitor the impact of its gilt sales programme on market conditions, and reserves the right to amend its schedule, including the gilts to be sold and the size of its auctions, or any other aspect of its approach at its sole discretion.

The Bank intends to communicate any future sales schedules for 2024 Q4 or beyond following the MPC’s annual review of the reduction in the stock of purchased gilts over the next twelve-month period, which is expected to be announced alongside the MPC meeting on 19 September 2024. 

Table: APF gilt sales auction calendar – July to September 2024