So the stock of gilts held by the Bank and removed from circulation rose by £4.5 billion, and now stands at £118 billion – which is over 97% of all the purchases made by the Bank using newly created money, its purchases of commercial assets amounting to a token £2.9 billion.

The total volume of gilts held by private investors and therefore available to be traded through the market also rose by £4.5 billion last week – the £9 billion newly issued by the Treasury, minus the £4.5 billion bought by the Bank.

But that was exceptional, as since the beginning of March the Treasury has issued about £64 billion, net of redemptions, while the Bank has bought up £118 billion, and therefore the volume of gilts in private hands has actually gone down by £54 billion.

That £54 billion paid by the Bank to private gilts investors in exchange for some of their holdings, but not yet used to purchase new gilts, will either have been used by them for other purposes, or it will be cash on deposit.

In effect the government now has two classes of gilts investors:

1. Normal private investors – their holdings have dropped by about £54 billion, but they still own over three quarters of the total stock of outstanding gilts.

2. An abnormal gilts investor, the Bank of England, which having spent £118 billion buying gilts now owns rather less than a quarter of the total stock.

They are different, because the private investors will no doubt insist that interest and redemption payments for their gilts must be made in cash in the normal way, and therefore they must be given priority; but as the Bank of England is publicly owned it may be induced to except payment in additional or replacement gilts, rather than in cash, so allowing the Treasury to roll over its debts for many years.