Skip to main content
  • This website sets cookies on your device. To find out more about how we use cookies please refer to our Privacy and Cookie Policy. By continuing to use the site, we’ll assume that you are content for us to set these on your device.
  • Close
Home > Markets and Payments > Quantitative easing and the Asset Purchase Facility
 

Quantitative easing and the Asset Purchase Facility

Quantitative easing is a tool used by our Monetary Policy Committee (MPC), where the Bank purchases assets such as gilts or corporate bonds. The aim is to boost economic activity, keeping the UK on track to meet the Government’s 2% inflation target. Our quantitative easing operations are carried out by the Asset Purchase Facility, and are financed by creating central bank reserves.

You can find out more about quantitative easing in our ‘Red Book’ or on our KnowledgeBank website.

On 4 August 2016, our Monetary Policy Committee voted to extend our programme of quantitative easing to £435bn and to make up to £10bn of corporate bond purchases over 18 months. The MPC also voted to introduce the Term Funding Scheme, to encourage banks to pass on Bank Rate cuts to customers by providing term funding to banks at rates close to Bank Rate.

Asset Purchase Facility transactions are undertaken by a subsidiary company of the Bank of England – the Bank of England Asset Purchase Facility Fund Limited (BEAPFF). The BEAPFF borrows from the Bank to pay for the assets it purchases under the Gilts and Corporate Bond Purchases schemes and the loans it makes under the Term Funding Scheme. This loan appears on the Bank's balance sheet as an asset. The corresponding liability is the increase in central bank reserves which have been created to fund the loan to BEAPFF.

Asset Purchase Facility results

The table below shows the outstanding stock of holdings from gilt purchases and from the Corporate Bond Purchase Scheme. It also shows the loans made through the Term Funding Scheme. All transactions have been financed by the creation of central bank reserves.

These data are as at close Wednesday 15 February (on a settlement date basis, net of any redemptions), and are updated weekly at 3pm on Thursdays.

Gilt purchases £427,212 million​
Corporate bond purchases ​£7,055 million
​Loans made through the Term Funding Scheme ​£38,489 million

 

A time series showing a running total of the quantity of assets purchased and loans made by the Asset Purchase Facility, financed by the creation of central bank reserves, is available in the Interactive Database (updated weekly on Fridays).

We also have a document summarising the sterling money market operations we are currently undertaking, including some of the operational parameters.

Schedule of operations

The table below outlines the dates that Asset Purchase Facility operations will normally take place. We reserve the right to change the dates or frequency of these operations in light of bank holidays or developments in market conditions.

Gilts ​Gilt purchase operations take place between 2.15pm and 2.45pm on operation dates. For operation dates, please see the latest market notice.
Corporate bond purchases ​Corporate bond purchase operations take place on Tuesdays, Wednesdays and Thursdays between 11am and 11.30am, or as set out in the market notice.
Term Funding Scheme ​The drawdown window opened on 19 September 2016.
 

 

Share

​Bank Rate cut and other measures
What do they mean?