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The profile of cash transfers between the Asset Purchase Facility and Her Majesty’s Treasury

Author

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  • McLaren, Nick

    (Bank of England)

  • Smith, Tom

    (Bank of England)

Abstract

In November 2012, a process for regular cash transfers between the Bank of England’s Asset Purchase Facility Fund Limited (APF) and Her Majesty’s Treasury (HMT) was established. The size and timing of these transfers depends on a number of uncertain factors, including the future path of Bank Rate, and the price at which the assets held by the APF are ultimately sold. This article uses a spreadsheet-based framework, which has also been made available on the Bank’s website, to show how the size and timing of the transfers varies depending on the assumptions made about these uncertain factors. While the initial transfers are from the APF to HMT, it is likely they will be offset by payments in the opposite direction in the future. The ultimate net amount that will be transferred is uncertain, and a wide range of outcomes is possible.

Suggested Citation

  • McLaren, Nick & Smith, Tom, 2013. "The profile of cash transfers between the Asset Purchase Facility and Her Majesty’s Treasury," Bank of England Quarterly Bulletin, Bank of England, vol. 53(1), pages 29-37.
    • Handle: RePEc:boe:qbullt:0095
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    File URL: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2013/the-profile-of-cash-transfers-between-the-asset-purchase-facility-and-her-majestys-treasury.pdf?la=en&hash=B6266BCB0BCC024E4DC76DED15847548936281AA
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    References listed on IDEAS

    as
    1. Joyce, Michael & Lasaosa, Ana & Stevens , Ibrahim & Tong, Matthew, 2010. "The financial market impact of quantitative easing," Bank of England working papers 393, Bank of England.
    2. Joyce, Michael & Tong, Matthew & Woods, Robert, 2011. "The United Kingdom’s quantitative easing policy: design, operation and impact," Bank of England Quarterly Bulletin, Bank of England, vol. 51(3), pages 200-212.
    3. Michael A. S. Joyce & Ana Lasaosa & Ibrahim Stevens & Matthew Tong, 2011. "The Financial Market Impact of Quantitative Easing in the United Kingdom," International Journal of Central Banking, International Journal of Central Banking, vol. 7(3), pages 113-161, September.
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    Cited by:

    1. Joerg Bibow, 2018. "Unconventional Monetary Policies and Central Bank Profits: Seigniorage as Fiscal Revenue in the Aftermath of the Global Financial Crisis," Economics Working Paper Archive wp_916, Levy Economics Institute.
    2. Christensen, Jens H.E. & Lopez, Jose A. & Rudebusch, Glenn D., 2015. "A probability-based stress test of Federal Reserve assets and income," Journal of Monetary Economics, Elsevier, vol. 73(C), pages 26-43.
    3. Michele Cavallo & Marco Del Negro & W. Scott Frame & Jamie Grasing & Benjamin A. Malin & Carlo Rosa, 2019. "Fiscal Implications of the Federal Reserve's Balance Sheet Normalization," International Journal of Central Banking, International Journal of Central Banking, vol. 15(5), pages 255-306, December.
    4. Del Negro, Marco & Sims, Christopher A., 2015. "When does a central bank׳s balance sheet require fiscal support?," Journal of Monetary Economics, Elsevier, vol. 73(C), pages 1-19.
    5. Jörg Bibow, 2018. "Unconventional monetary policies and central bank profits," IMK Studies 62-2018, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

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