Economic Affairs Committee
Quantitative easing: a dangerous addiction?

1st Report of Session 2019-21 - published 16 July 2021 - HL Paper 42



Chapter 1: Introduction

Bank of England independence

What is quantitative easing?

Figure 1: Quantitative easing transmission mechanisms

Global context

Figure 2: Selected central bank balance sheets
(US Federal Reserve, European Central Bank, Bank of Japan, Bank of England and Swiss National Bank)

Quantitative easing in the UK

Figure 3: Bank of England QE programmes and selected policy interventions since 2009

Figure 4: Bank of England bond purchases by the month that new purchases were announced

Figure 5: Bank of England balance sheet as a percentage of GDP

Our inquiry

Witnesses and evidence

Chapter 2: Impact of quantitative easing

Effectiveness of quantitative easing

‘Knowledge gaps’

Distributional effects

Chapter 3: QE and the COVID-19 pandemic

Independence and accountability

Allegations of deficit financing

Figure 6: Bank of England quantitative easing and Government borrowing requirements

Clarity of communications

Bank of England mandate

Chapter 4: The future of quantitative easing

Inflationary pressures

Figure 7: Bank of England inflation forecasts and CPI annual inflation rate, 2021 (%)

Debt management

Asset Purchase Facility and the indemnity

Figure 8: Stylised Asset Purchase Facility cash flows

The effect on the public finances

Figure 9: Effects of the Asset Purchase Facility on the public finances

Figure 10: Mean maturity and redemption distribution of gilts

Figure 11: Net savings to the public sector of the APF based on the Office for Budget Responsibility’s scenarios

Deed of Indemnity

Unwinding quantitative easing

Chapter 5: Conclusion

Summary of conclusions and recommendations

Appendix 1: List of Members and declarations of interest

Appendix 2: List of witnesses

Evidence is published online at and available for inspection at the Parliamentary Archives (020 7219 3074).

Q in footnotes refers to a question in oral evidence.

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