'Media Hysteria!'29 Sep 2022 07:11
'The BoE intervention today is aimed at assuaging media hysteria '- GateBoy
Threadneedle Street said the fallout from a dramatic rise in government borrowing costs since the chancellor’s statement had left it with no choice but to intervene to protect the UK’s financial system.
'City sources said the surprise move, less than a week after Kwarteng’s unfunded tax giveaways, was needed to halt a “doom loop” in the bond markets that risked draining pension funds of cash and leaving them at risk of insolvency.
The Bank was concerned that it threatened the financial health of Britain’s biggest pensions and insurance companies, which together manage trillions of pounds of people’s cash.
In a reversal of a policy position announced on the day before Kwarteng’s fiscal event, the Bank said it was setting aside £65bn to buy bonds over the next 13 working days to ease pressure on pension funds and insurance companies.'
Reality check.