The operation of monetary policy

• UK official interest rates were cut once during the April-June quarter, by 25 basis points to 5¾% on 6 June, three months after the previous cut.
• Future rates implied in UK markets also fell during the quarter, most clearly at the short end of the money market, and by diminishing amounts through medium maturities in the gilt market.
• The spread of UK bond yields over those in other major markets declined, and sterling appreciated, though these movements were largely reversed soon after the quarter’s end.
• Gilt sales of £11.1 billion were made.

The operation of monetary policy