CNBC: Bank of England intervenes in bond markets again, warns of ‘material risk’ to UK financial stability
* “Dysfunction in this market, and the prospect of self-reinforcing ‘fire sale’ dynamics pose a material risk to UK financial stability,” the Bank of England warned.
* The move marks the second expansion of the central bank’s 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.
LONDON — The Bank of England on Tuesday announced an expansion of its emergency bond-buying operation as it looks to restore order to the country’s chaotic bond market.
The central bank said it will widen its purchases of U.K. government bonds — known as gilts — 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.
The move marks the second expansion of the Bank’s 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 on Friday.
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WNU Editor: I do not know how long the Bank of England can keep propping up these financial markets. And not surprising, the predictions of the future for the UK are becoming very dark .... UK economy set to suffer deeper recession next year as interest rates rise faster (Yahoo finance). More here .... IMF warns rising prices will be worse in UK (BBC).
Neil McCoy-Ward gives a good explanation on how dire the situation is becoming for the UK:
U.K. Economy Almost Collapsed Again Today!
Bank of England urged to extend emergency bond-buying scheme -- The Guardian
Bank of England warns risk of UK financial crisis hasn’t gone away -- CNN
Bank of England warns risk of UK financial crisis hasn’t gone away -- BBC
UK bond market moves are dramatic — and confusing. And analysts think it could get worse -- CNBC
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