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Bailey on QE: Decision Today Is Not Tapering

BOE

Q: Can we take from the forecasts that the Bank feels it has done enough for the recovery? Does the vote split on the QE target say anything about the way the BoE plans to wind down QE - expecting to reduce stock of bonds before rate hikes?

  • A (Bailey): We have not got to any conclusion on reducing QE. There is no message in today's announcement to be taken on the future course of QE.
Q: You have slowed the pace of purchases and slightly tweaked the guidance. Are there any initial thoughts on how you will manage the transition away from the emergency support without causing a taper tantrum of sorts?
  • A (Bailey): We have no thoughts on this. The decision today is not a tapering decision. We are doing fixed QE, not open-ended. We have not changed the fixed amount. Our view is that the announcement of the stock of QE is an important part of the impact and transmission of QE. And we have not changed that stock.
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