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The financial market impact of UK quantitative easing

Francis Breedon (), Jagjit Chadha () and Alex Waters ()

Oxford Review of Economic Policy, 2012, vol. 28, issue 4, 702-728

Abstract: After outlining some of the monetary developments associated with quantitative easing (QE), we measure the impact of the UK’s initial 2009–10 QE programme on bonds and other assets. First, we use a macro-finance yield curve both to create a counterfactual path for bond yields and to estimate the impact of QE directly. Second, we analyse the impact of individual QE operations on a range of asset prices. We find that QE significantly lowered government bond yields through the portfolio balance channel—by around 50 or so basis points. We also uncover significant effects of individual operations but limited pass-through to other assets. Copyright 2012, Oxford University Press.

Date: 2012
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Chapter: The financial market impact of UK quantitative easing (2012) Downloads
Working Paper: The Financial Market Impact of UK Quantitative Easing (2012) Downloads
Working Paper: The Financial Market Impact of UK Quantitative Easing (2012) Downloads
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