* BoE turns away all corporate bond sellers for first time
* Recovery in risk appetite lessens need for "backstop" bid
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LONDON, May 7 (Reuters) - The Bank of England declined to purchase any corporate bonds on Thursday for the first time since it began buying corporate debt for its quantitative easing programme in March.
The central bank had offered to purchase up to 176 million pounds ($267 million) of sterling-denominated corporate bonds at Thursday's auction.
A recovery in risk appetite has boosted liquidity in the corporate bond market in recent days, driving down the yield differential between corporate and government debt.
"The prices that were offered were probably higher than the Bank of England was prepared to pay," said Alan Clarke, an economist at BNP Paribas.
So far, more than 95 percent of the central bank's asset purchases have been gilts, nearly 4 percent commercial paper and only one percent corporate bonds.
However, when it announced its 75 billion pound asset purchase scheme in March, the BoE made clear that it would focus primarily on gilts. It said its purchases of corporate bonds were designed to provide a "backstop" bid to aid secondary market liquidity.
* For full details of the purchases, go to
http://www.bankofengland.co.uk/markets/money/Round2.html (Reporting by Christina Fincher; Editing by Ron Askew)