The swift and significant response of the Bank of England to the coronavirus crisis has prevented a financial crisis, but we think the Bank will need to do much more than the markets currently expect to get the economy back on track. By this time next year, we suspect that the Bank will have announced an extra £350bn of quantitative easing, which would take the stock of QE to almost £1,000bn. We think it will be five years before the Bank raises interest rates above 0.10% and at least ten years before it even thinks about unwinding QE.
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