{"id":63768,"date":"2022-10-11T07:45:07","date_gmt":"2022-10-11T12:45:07","guid":{"rendered":"https:\/\/olduvai.ca\/?p=63768"},"modified":"2022-10-11T07:45:07","modified_gmt":"2022-10-11T12:45:07","slug":"bank-of-england-intervenes-in-bond-markets-again-warns-of-material-risk-to-uk-financial-stability","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=63768","title":{"rendered":"Bank of England intervenes in bond markets again, warns of \u2018material risk\u2019 to UK financial stability"},"content":{"rendered":"<div class=\"PageBuilder-containerWidth100 PageBuilder-pageRow\">\n<div class=\"PageBuilder-col-full PageBuilder-col PageBuilder-article\">\n<div id=\"RegularArticle-ArticleHeader-2\" data-test=\"articleHeader-0\" data-analytics=\"RegularArticle-articleHeader-2-0\">\n<header id=\"main-article-header\" class=\"ArticleHeader-articleHeader\">\n<div class=\"ArticleHeader-headerContentContainer\">\n<div class=\"ArticleHeader-wrapperHeroNoImage ArticleHeader-wrapperHero ArticleHeader-wrapper ArticleHeader-wrapperNoImage\">\n<div>\n<h3 class=\"ArticleHeader-headline\"><a href=\"https:\/\/www.cnbc.com\/2022\/10\/11\/bank-of-england-expands-bond-market-intervention-in-effort-to-quell-volatility.html\">Bank of England intervenes in bond markets again, warns of \u2018material risk\u2019 to UK financial stability<\/a><\/h3>\n<\/div>\n<\/div>\n<\/div>\n<\/header>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"PageBuilder-containerFluidWidths PageBuilder-pageRow\">\n<div class=\"PageBuilder-col-9 PageBuilder-col PageBuilder-article\">\n<div id=\"RegularArticle-KeyPoints-4\" class=\"RenderKeyPoints-keyPoints\" data-test=\"keyPoints-1\" data-analytics=\"RegularArticle-keyPoints-4-1\">\n<div class=\"RenderKeyPoints-wrapper\">\n<div class=\"RenderKeyPoints-list\">\n<div>\n<div class=\"group\">\n<ul>\n<li>\u201cDysfunction in this market, and the prospect of self-reinforcing \u2018fire sale\u2019 dynamics pose a material risk to UK financial stability,\u201d the Bank of England warned.<\/li>\n<li>The move marks the second expansion of the central bank\u2019s extraordinary rescue package in as many days, after it increased the limit for its daily gilt purchases on Monday ahead of the planned end of the purchase scheme.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div id=\"RegularArticle-ArticleBody-5\" class=\"ArticleBody-articleBody\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-5-2\">\n<div id=\"ArticleBody-InlineImage-106946150\" class=\"InlineImage-imageEmbed\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div class=\"InlineImage-imagePlaceholder\">\n<div>\n<div class=\"InlineImage-imageContainer\" tabindex=\"-1\" data-test=\"InlineImage-pictureContainer\"><picture data-test=\"Picture\"><source srcset=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106946150-1632384022074-gettyimages-1235330347-Vuk_Valcic_City_170921_10.jpeg?v=1665468586&amp;w=740&amp;h=416&amp;ffmt=webp\" type=\"image\/webp\" media=\"(min-width: 1340px)\" \/><source srcset=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106946150-1632384022074-gettyimages-1235330347-Vuk_Valcic_City_170921_10.jpeg?v=1665468586&amp;w=630&amp;h=354&amp;ffmt=webp\" type=\"image\/webp\" media=\"(min-width: 1020px)\" \/><source srcset=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106946150-1632384022074-gettyimages-1235330347-Vuk_Valcic_City_170921_10.jpeg?v=1665468586&amp;w=929&amp;h=523&amp;ffmt=webp\" type=\"image\/webp\" media=\"(min-width: 760px)\" \/><source srcset=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106946150-1632384022074-gettyimages-1235330347-Vuk_Valcic_City_170921_10.jpeg?v=1665468586&amp;w=717&amp;h=403&amp;ffmt=webp\" type=\"image\/webp\" media=\"(min-width: 0px)\" \/><img decoding=\"async\" class=\"\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/106946150-1632384022074-gettyimages-1235330347-Vuk_Valcic_City_170921_10.jpeg?v=1665468586&amp;w=929&amp;h=523\" alt=\"The Bank of England raised rates by 0.5 percentage points Thursday.\" \/><\/picture><\/div>\n<\/div>\n<\/div>\n<div>\n<div class=\"InlineImage-imageEmbedCaption\">The Bank of England raised rates by 0.5 percentage points Thursday.<\/div>\n<div class=\"InlineImage-imageEmbedCredit\">Vuk Valcic | SOPA Images | LightRocket | Getty Images<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>LONDON \u2014 The\u00a0<a href=\"https:\/\/www.cnbc.com\/bank-of-england\/\">Bank of England<\/a>\u00a0on Tuesday announced an expansion of its emergency bond-buying operation as it looks to restore order to the country\u2019s chaotic bond market.<\/p>\n<p>The central bank said it will widen its purchases of U.K. government bonds \u2014 known as gilts \u2014 to include index-linked gilts from Oct. 11 until Oct. 14. Index-linked gilts are bonds where payouts to bondholders are benchmarked in line with the U.K. retail price index.<\/p>\n<p>The move marks the second expansion of the Bank\u2019s extraordinary rescue package in as many days, after it\u00a0<a href=\"https:\/\/www.cnbc.com\/2022\/10\/10\/bank-of-england-announces-liquidity-measures-to-help-ease-pension-fund-issues.html\">increased the limit for its daily gilt purchases<\/a> on Monday ahead of the planned end of the purchase scheme on Friday.<\/p>\n<\/div>\n<div class=\"group\">\n<p>The Bank launched its emergency intervention on Sep. 28 after an unprecedented sell-off in long-dated U.K. government bonds threatened to\u00a0<a href=\"https:\/\/www.cnbc.com\/2022\/10\/06\/bank-of-england-says-pension-funds-were-hours-from-disaster-before-it-intervened.html\">collapse multiple liability driven investment (LDI) funds<\/a>, widely held by U.K. pension schemes.<\/p>\n<p>\u201cThe beginning of this week has seen a further significant repricing of UK government debt, particularly index-linked gilts. Dysfunction in this market, and the prospect of self-reinforcing \u2018fire sale\u2019 dynamics pose a material risk to UK financial stability,\u201d the bank said in a statement Tuesday.<\/p>\n<\/div>\n<div class=\"group\">\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Bank of England intervenes in bond markets again, warns of \u2018material risk\u2019 to UK financial stability \u201cDysfunction in this market, and the prospect of self-reinforcing \u2018fire sale\u2019 dynamics pose a material risk to UK financial stability,\u201d the Bank of England warned. The move marks the second expansion of the central bank\u2019s extraordinary rescue package in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[56,3756,5185,964,33253,5386],"class_list":["post-63768","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bank-of-england","tag-boe","tag-bond-market","tag-cnbc","tag-elliot-smith","tag-financial-risk"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63768","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=63768"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63768\/revisions"}],"predecessor-version":[{"id":63769,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63768\/revisions\/63769"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=63768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=63768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=63768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}