June 22, 2020 / 6:24 AM / 16 days ago

Bank of England's Bailey proposes change to QE reversal policy

LONDON, June 22 (Reuters) - Bank of England Governor Andrew Bailey said on Monday that the central bank should start to reverse its quantitative easing asset purchases before raising interest rates on a sustained basis, a reversal of long-standing BoE policy.

Bailey said the time for such action was not now, but that the high level of central bank asset purchases “shouldn’t always be taken for granted”.

“When the time comes to withdraw monetary stimulus, in my opinion it may be better to consider adjusting the level of reserves first without waiting to raise interest rates on a sustained basis,” Bailey wrote in an article for Bloomberg. (Reporting by David Milliken; editing by Sarah Young)

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