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The Bank of England announced a reduction in the spread of the Operational Standing Facility (OSF) to Bank Rate ±15 bps, aligning with its shift to a repo-led liquidity management framework. This recalibration aims to enhance market efficiency by narrowing the gap between lending and deposit rates, ensuring smoother liquidity operations. The move reflects the central bank's effort to stabilize financial conditions while maintaining demand-driven reserve provision. The adjustment is expected to influence short-term interest rate dynamics in European markets and impact forex trading volumes.
