Statement
The Bank of England has published a Market Notice setting out its intention to introduce a Short Term Repo facility alongside any future sales of gilts from the Asset Purchase Facility (APF).
The STR is designed to provide eligible banks and building societies with ready access to reserves in order to ensure short-term market interest rates remain close to Bank Rate as the APF is unwound.
The Bank intends that the STR should be used freely from the point of introduction, as a way for counterparties to access reserves as necessary.
The PRA would judge use of the STR as routine participation in sterling money markets and intends that it should be seen as such by bank boards and overseas regulators.