The Government is taking £35 billion of cash sitting on the Bank of England’s balance sheet in a surprise raid that will flatter the public accounts in the short term and provide a modest monetary stimulus to the economy.
George Osborne and Sir Mervyn King jointly announced the cash grab yesterday, with the Chancellor describing it as a sensible and more efficient way of managing cash.
But the independent Office for Budget Responsibility was sceptical, saying that the short-term benefits to the public borrowing figures might be outweighed by higher borrowing costs in the longer term.
Some economists also weighed
Source:
http://13lei.net/2012/11/09/osborne-dips-into-bank-of-englands-savings-account-the-times-subscription/