The Bank of England has stopped treating £488.2 billion of QE holdings as one unwind problem. £221.7 billion of gilts maturing before 2035 will run off naturally; £120 billion of the longest maturities will be held to back banknote issuance; and £146.5 billion maturing from 2035 to 2049 will be reduced at £20 billion a year. Its own sale auctions pause while it considers transferring that middle bucket to the government at market prices through the Debt Management Office. A final decision is due before April 2027. Bank market notice
The restructuring separates monetary-policy unwind from currency issuance and market execution. A sale to the DMO would still increase government financing needs, but it could avoid forcing long-duration inventory through a separate central-bank auction programme. That matters for dealer balance sheet, syndication and the shape of supply.
The MPC also held Bank Rate at 3.75% by 6–3; the minority wanted 4%. The gilt decision was unanimous. September minutes