The government is to hand over £170 billion to the Bank of England to cover losses on its bond-buying scheme over the next decade, new analysis by the central bank suggests.
Losses on the Bank’s quantitative easing (QE) programme, which are backstopped by the Treasury, are forecast to rise significantly as it sells the gilts back into depressed financial markets.
It is a stark turnaround from the large profits the Bank made on its bond purchases in the years immediately after the 2008 financial crisis when interest rates fell to rock bottom. Up until 2022, the Bank made cumulative profits of £124 billion on QE, which was sent to the Treasury.
Previously, the Bank had estimated that it would make a £150 billion loss on