Market comment - Bank of England intervenes with £65bn of gilt purchases

Davy Research
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Sterling is stable against the euro this morning, with 10-year gilt yields falling back to 4% in the wake of the Bank of England’s £65bn intervention to stabilise the market. However, the hunt will now be on to identify further problems in the UK pension fund industry. If successful, investors may begin to question the Bank of England’s resolve to bring back CPI inflation to 2% – its monetary policy and financial stability goals coming into conflict.