4 min read.Updated: 20 May 2021, 10:21 PM ISTRobert Skidelsky
Reluctance to admit the relevance of Keynesian theory over monetarism has warped the language of macroeconomic policy
Since March 2020, the Bank of England (BoE) has bought £450 billion of UK government debt through its so-called asset purchase facility. Virtually all of this was new debt issued by the government since the start of the covid crisis. The BoE’s purchases look like a thinly veiled attempt to use quantitative easing (QE) to finance the government’s deficit and ensure low borrowing costs. Is this still monetary policy, or is the central bank conducting fiscal policy by the back door?
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