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Select committee: Economic Affairs Committee

Bank of England response to Central bank digital currencies: a solution in search of a problem? (16 March 2022)

Published 18 March 2022

Economic Affairs Committee Central Bank Digital Currencies Report on parliament.uk ↗

At a glance

The government's response

This document responds to 3rd Report - Central bank digital currencies: a solution in search of a problem?.

This is the government's response, published 18 March 2022.

Summary written by Accountability Index from the government's response. It is not the government's own words.

The Bank says no decision has been made on whether to introduce a CBDC, and that it is in a "research and exploration" phase, with many of the Committee's issues to be addressed in a 2022 Consultation Paper.

  • The Bank and HM Treasury will publish a Consultation Paper in 2022 assessing the case for a UK CBDC, and the Bank says it will address the need for in-depth articulation of the 'use case' in that paper.
  • On monetary policy, the Bank says it does not "consider expanding the monetary policy toolkit to be a motivation for the introduction of a CBDC", noting the opportunities are "largely conceptual" and face practical constraints.
  • On the 20% deposit scenario, the Bank notes its 2021 modelling was "an illustrative scenario rather than a forecast", and says it will cover bank disintermediation in the Consultation Paper.
  • On wholesale CBDC, the Bank points to its existing RTGS service, which it is due to move to a new platform in 2024, and says it will issue a public consultation in spring 2022 on further RTGS enhancements beyond 2024.

Read the government's response ↗ Report an error

Sources