Pension funds call for longer bailout as Bank of England set to pull plug on emergency bond-buying - Daily Mail

Pension funds call for longer bailout as Bank of England is set to pull the plug on emergency £65 billion bond-buying scheme to tackle market chaos

• The intervention from the bank is due to end on Friday after being extended
• It originally said it would buy up to £65billion of bonds, and £5billion a day
• Pension funds are said to be worried with a large amount of 'nervousness' about

By John-paul Ford Rojas For The Daily Mail

Published: 22:44 BST, 13 October 2022 | Updated: 22:52 BST, 13 October 2022

Pension funds are bracing themselves for the Bank of England to pull the plug today on a £65billion bailout designed to protect them from bond market chaos.

The Bank stepped in with the emergency help two weeks ago after a sell-off in government bonds, known as gilts, left the retirement schemes scrambling for cash. 

It said it would buy £5billion in bonds a day – since beefed up to £10billion. 

The intervention is due to end today, but some funds have been asking for more time to sort out their finances.

One market-watcher said it was a 'tall order' to have done so by now. The latest Bank auction yesterday saw it buy £4.7billion worth of bonds – the biggest daily sum so far – taking the total to £17.8billion. 

The Bank launched the intervention on September 28 following market chaos after Kwasi Kwarteng's mini-Budget.

Earlier this week, governor Andrew Bailey squashed speculation that the scheme would be extended, telling funds: 'You've got three days left now. You've got to get this done.' 

Craig Inches, head of rates at Royal London Asset Management, said Mr Bailey had effectively given them a 'Mission Impossible' to get their house in order 'before this intervention self-destructs'. 

That seemed to 'wake up' funds, he said, but the Bank could still intervene if more market chaos emerges.

Bonds staged a recovery yesterday, but Sandra Holdsworth, of Aegon Asset Management, said: 'There's a huge amount of nervousness for next week.'

Retirement schemes faced having to raise around £320billion; Miss Holdsworth said: 'Probably the sheer scale of it will take time to work through.'

Adblock test (Why?)

https://news.google.com/__i/rss/rd/articles/CBMiiQFodHRwczovL3d3dy5kYWlseW1haWwuY28udWsvbmV3cy9hcnRpY2xlLTExMzEzNzA1L1BlbnNpb24tZnVuZHMtY2FsbC1sb25nZXItYmFpbG91dC1CYW5rLUVuZ2xhbmQtc2V0LXB1bGwtcGx1Zy1lbWVyZ2VuY3ktYm9uZC1idXlpbmcuaHRtbNIBAA?oc=5

2022-10-13 21:44:46Z
1593700983