BoE Tweak Sequencing Guidance, Will Begin QE Unwind at 0.50%

MPC was unanimous in keeping rates unchanged, but voted 7 - 1 on the asset purchase program. Saunders was the dissenter, preferring to "stop the current asset purchase programme as soon as practical".

On sequencing:

• "The MPC intends to begin to reduce the stock of purchased assets, by ceasing to reinvest maturing assets, when Bank Rate has risen to 0.5% and if appropriate given the economic circumstances."
• "The MPC will consider actively selling some of the stock of purchased assets only once Bank Rate has risen to at least 1%."

The 0.50% to stop reinvestments is likely in line with market thinking. But the 1.00% threshold to sell back to the market was not really expected to be committed to today.