The Bank of England expanded its assets by a further 3% in the week to Wednesday 26th September, following a 13% increase in the previous week.
Taking the two weeks together assets have grown by £14.3 billion, of which £6.5 billion represents increased lending to the money market via reverse repurchase agreements. An additional £7.75 billion is classified under “other assets”, a category that is likely to include the Bank’s lender of last resort support to Northern Rock.
As the chart below shows, “other assets” showed limited week-to-week variation before the recent surge. It is possible that other undisclosed activities have contributed to the increase, but the latest figures will fuel speculation that the Bank has been forced to extend massive support to the troubled mortgage lender.
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