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BoE quantitative tightening likely to be delayed until later this year -fund manager By Reuters

© Reuters. FILE PHOTO: People stand outside of the Bank of England in London, Britain, October 10, 2022. REUTERS/Hannah McKay

LONDON (Reuters) – The Bank of England should consider giving markets “some comfort” around its quantitative tightening timetable, and will likely push back the long-anticipated policy change until later this year, a portfolio manager at U.S.-based investment manager Federated Hermes (NYSE:) said on Tuesday.

Orla Garvey, senior fixed income portfolio manager at Federated Hermes, said the central bank’s quantitative tightening (QT), which is set to start on Oct. 31, was likely to be delayed until later this year. QT is a monetary policy used to shrink central bank balance sheets.

“There are a lot of risk events coming that could impact market stability in the next few weeks, with the OBR report scheduled at the end of the month, and multiple central bank meetings,” Garvey, referring to the Office for Budget Responsibility report due Nov. 23, said in a statement supplied to Reuters.

Under new Prime Minister Liz Truss, the British government set out a so-called mini-budget late last month that has sent shockwaves through the financial markets as worries over how the budget would be funded pushed the pound down to an all-time low and caused sharp falls in UK bonds, known as gilts.

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