The Bank of England on Tuesday became the first central bank to sell some of the government debt that it bought up as part of the massive 'quantitative easing' (QE) programme launched in response to the 2008 global financial crisis.
Beginning the process of unwinding, or 'quantitative tightening' (QT), Threadneedle Street offloaded £750mln of short-term gilts.
It is aiming to reduce its balance sheet by £80bn per year, in line with a target set by the Bank's monetary policy committee (MPC).
The Bank ended its last round of QE gilt purchases in December 2021 and then stopped reinvesting the proceeds when a bond matures.
With the first government bond maturing in March 2022, the number of bonds held by the Bank had already started to fall.
But last month, after the catastrophic 'mini Budget' of the short-lived Liz Truss government, the BoE had to buy bonds again to try and stabilise the gilt market, delaying its intended start date.
On Thursday, the MPC will also make its latest interest rate decisions and deliver its latest economic forecasts for inflation and GDP.
Another rate hike is expected, either half or three-quarters of a percent, with some even calling for a full point.