RE: Bank of England chief sees downward interest rate trend as UK hunts for growth2 Jul 2025 14:30
The UK interest rates are high predominantly to the ideology of the BoE board and crazy UK rules.
First instead of just allowing gilts to expire and remove them from the BoE's balance sheet they are actively selling billions into the market at a loss and therefore competing against the government for buyers which pushes prices up.
Second, and as far as I know only in the UK (certainly not US or EU) when the central bank makes a loss of gilts/bonds, the UK government, with our tax money, makes it whole despite the fact a central bank who 'prints' debt in it's own currency can't go bust.
So as well as costing the Government, and therefore us as the people of the country, more to borrow, they are also taking tax and borrowed money out of out coffers to balance a virtual book that doesn't need balancing (at current QT rate that's £24 billion per year going to the BoE and not going to NHS, education, infrastructure, etc, etc.)