Update: Bank of England’s APF buys £50m of CP

The Bank of England said on Friday it bought £50m of commercial paper in the week to May 7 through its asset purchase facility. The total CP held by the facility fell from £2.14bn the previous week to £2.015bn. Last week, the facility did not buy any CP, the first time no issuers or investors have sold paper to the fund since the facility was launched on February 13. The facility bought £125m of CP in the week closing April 23. It bought £76m in the last week of March, £50m in the first week of April and just £15m in the second week of April, before a surprise jump to £345m for the week ending April 16. As the APF approaches the three month mark, market participants are divided on whether the fund has had its day. Some believe that the market no longer needs it, while others believe that new issuers will make use of the cheap funding it offers.