Asset Purchase Facility: Gilt Sales – Market Notice 17 September 2026

Market Notice

At its meeting ending on 16 September 2026, the MPC set out a multi-year path to reduce the stock of UK government bond purchases held henceforth for monetary policy purposes to zero, through annual sales of £20 billion alongside maturing gilts.

In implementing the MPC’s decision, the Bank Executive has decided to retain in the APF £222 billion of gilts maturing before 2035 to maturity. In addition, £120 billion of the longest-dated gilts will remain in the APF and be held to maturity by the Bank for the purposes of indirectly backing current and future banknote issuance. These include part of the APF’s holding of the 1.75% 2049 gilt, and all gilts that mature after that.

For the remaining gilts, which mature between 2035 and 2049, and amount to £146 billion in purchase proceeds terms, the Bank has engaged with HM Treasury (HMT) and the Debt Management Office (DMO) to consider a model whereby the MPC’s decision could be implemented through APF sales to the Government. Under this model, HMT would instruct the DMO to purchase the APF gilts that the Bank Executive is selling in its implementation of the MPC’s multi-year plan. Sales would be conducted at market prices and in a pre-defined manner, pre-announced by the Bank Executive. Gilts would be sold at an annualised pace of £20 billion a year, in line with the MPC’s decision on its multi-year approach to APF unwind, with sales concluding around the time of the unwind of gilts held to maturity in 2034.

The Bank will review progress before April 2027 such that, subject to a final decision to proceed, implementation could begin in a way that allows this to be incorporated into the DMO’s annual financing remit, as set by HMT. Further operational details will be announced in due course. Irrespective of the final decision, the Bank will be announcing by April 2027 the operational details through which it will be implementing the MPC’s multi-year plan. Bank APF auctions will pause in the meantime. Regardless of the method of sales, the Bank Executive will ensure that the MPC’s agreed sales pace is implemented, subject only to amendments in the circumstances outlined by the MPCfootnote [1]. The full portfolio of APF gilts will continue to be made available for the DMO to borrow via the APF gilt lending facility, in line with existing arrangements.

The approach taken by the Bank for each individual remaining APF gilt holding is outlined in Table 1.

Table 1: Approach to each APF gilt holding

Total amount in purchase proceeds terms (£bn)

Purchase proceeds holding (£bn)

Unwound at an annualised pace of £20bn a year. The Bank will review a model of selling these gilts to the Government.

Held to indirectly back banknotes via the Issue Deposit

* £7.8bn of the APF’s holding of the 1.75% 2049 gilt will be retained to back banknotes, while £15.0bn will be sold. Figures are rounded to one decimal place.

These are if the MPC judged that potential movements in Bank Rate alone were insufficient to meet the inflation target. Or, if markets were judged by the Bank to be very distressed. The Financial Policy Committee would have a role in this second circumstance through its assessment of financial stability.

These are if the MPC judged that potential movements in Bank Rate alone were insufficient to meet the inflation target. Or, if markets were judged by the Bank to be very distressed. The Financial Policy Committee would have a role in this second circumstance through its assessment of financial stability.

These are if the MPC judged that potential movements in Bank Rate alone were insufficient to meet the inflation target. Or, if markets were judged by the Bank to be very distressed. The Financial Policy Committee would have a role in this second circumstance through its assessment of financial stability.