from qe. moreover, in february we did make an unexpected announcement of a change in the maturity structure of our purchases. this was intended to prevent the bank ’ s holdings becoming unduly concentrated in any particular segment of the market and had the for a summary of the evidence, including references to related studies, see michael joyce, matthew tong and robert woods ( 2011 ), “ the united kingdom ’ s quantitative easing policy : design, operation and impact ” bank of england quarterly bulletin, 51 ( 3 ), 200 – 212. specifically, investment - grade yields fell by around 70 basis points, while sub - investment grade yields fell by around 150 basis points. bis central bankers ’ speeches consequence of shifting them more towards shorter durations. the subsequent response of yields at different maturities was broadly in line with what would have been expected on the basis of our first round of purchases ( see chart 3 ). the approach is also less suited to analysing the impact on the prices of assets which are less immediate substitutes, such as equities. these are likely to take longer to adjust, as it probably takes a while for portfolio managers to decide how they want to rebalance their portfolios. but, as chart 2 shows, equity prices rose substantially once qe was actually under way – by around 50 % during qe1 and around 10 % during qe2. in both cases, the switch from decline to growth coincides with the commencement of asset purchases. it seems unlikely that all of the recovery in equity prices during these periods was down to our qe. during both phases of the programme, the us federal reserve undertook similar policies, and in recent months the ecb has injected large amounts of liquidity through its two longer - term refinancing operations. equity prices rose in those jurisdictions too. many of the companies in the equity price indices are international in focus and will be as exposed to developments abroad as in their home market. moreover, there will have been other factors affecting equity prices, though during the second programme those other factors – slowing growth and the worsening euro - area situation – seem more likely to have depressed equity prices, rather than boosted them. given that qe is supposed to operate by driving asset prices up, however, it would seem peculiar not to ascribe some part of the rise to our actions. econometric studies4 carried out at the bank imply that equity prices probably rose by about 20 % as a result of the first phase

, reflecting in part efforts to stimulate domestic demand, that has been offset by a widening in the surplus of the major oil producers as increased revenues resulting from high oil prices are largely saved rather than spent. while one might expect the chinese economy to continue to rebalance towards greater reliance on domestic demand and lower savings, that process is likely to take many years to play out, so an early reversal of that factor holding down yields seems unlikely. another possibility is a shortage of high - quality safe assets, 10 with countries like china accumulating reserves particularly in the form of us treasuries. that in turn will also have increased the demand for substitutes, including the government debt of other advanced economies. but recent events in the euro area have highlighted the fact that the debt of for instance, if an employer is putting aside an additional 15 % of the wage bill to cover accumulating pension liabilities and the price of buying a given stream of future income rises by 20 %, then he would now need to put aside an additional 3 % of the wage bill to meet those obligations. see ben bernanke ( 2005 ), “ the global saving glut and the us current account deficit ”, sandridge lecture, virginia association of economics, richmond, virginia, 10 march. see ricardo caballero, emmanuel farhi and pierre - olivier gourinchas ( 2008 ), “ an equilibrium model of global imbalances and low interest rates ”, american economic review, pp. 358 – 393. bis central bankers ’ speeches some sovereigns is not as safe as market participants thought. that has led to increased demand for the debt of those sovereigns that are still regarded as safe, including that of the united kingdom. how long such a “ safe - haven discount ” persists depends not only on what happens in this country but also what happens abroad : the demand for one country ’ s bonds as a safe haven depends in part on how risky those of other countries are thought to be. since the financial crisis and subsequent recession, another factor likely to have contributed to depressing yields is the sharp decline in investment, prompted by the deterioration in the outlook and heightened uncertainty. to date the recovery has been painfully slow, with negligible growth in the united kingdom over the past year and a half. and though there is some variation in the pace of recovery across countries, in general growth has been weaker than after a normal cyclical downturn. in part that reflects the fact