Bank of England Considers Halt to Long-Term Gilt Sales Amid Bond Sell-Off

The Bank of England is reportedly planning to suspend sales of long-term government bonds, also known as gilts, in an effort to reduce losses for taxpayers. According to The Telegraph, officials at Threadneedle Street have worked with the Treasury and Debt Management Office (DMO) on plans to change the Bank's bond-selling programme.

The proposal would stop selling 20- and 30-year gilts accumulated during efforts to stabilise the economy through the financial crisis and Covid lockdowns. Economists estimate that sales of these long-term debts have cost taxpayers £22 billion since 2022.

Britain paid its highest borrowing rate in over 25 years last week, with concerns about inflation and the sustainability of government debt adding pressure on Chancellor John Healey ahead of his first Budget on October 28. Borrowing costs also reached 5% for the first time since 2023.