London Daily

Focus on the big picture.
Saturday, Jul 04, 2026

Bank of England ceases bond-buying after spending £19.3bn

Bank of England ceases bond-buying after spending £19.3bn

The interest rate on these bonds had reached highs not seen since the financial crash of 2008, due to a lack of market confidence in the UK economy.
The Bank of England has purchased £19.3bn of UK government bonds and concluded part of its extraordinary intervention to prevent a collapse in the pensions industry.

Just five days after the former chancellor unveiled his mini-budget on 23 September, the Bank took unprecedented action to purchase long-dated UK government bonds, known as gilts, that are effectively government IOUs.

Bonds are a principal way countries raise funds.

Due to a lack of market confidence in the UK economy, the interest rate on these bonds had reached highs not seen since the financial crash of 2008.

The result was government borrowing was more expensive and holding on to bonds became more expensive.

As a result pension funds sold large numbers of the bonds. In an effort to prevent a mass sell-off and a collapse in the pensions market, the Bank announced it was intervening to buy up 20 and 30-year gilts to steady the market.

That intervention was only to last 13 days, the Bank said. A total of £65bn could have been spent - £5bn a day.

Earlier this week the interest rate payments on the gilts began to rise again as fears rose of the approaching 13-day cliff edge.

Another statement came from the Bank on Monday that it was to purchase a new kind of gilt - index-linked gilts that have interest rates linked to inflation.

Additional supports were announced for lenders who lend money to pension funds involved in a part of the pensions industry that was described by the Bank as experiencing "dysfunction".

Of the £19.3bn spent, £7bn went on index-linked gilts, and £12.1bn went on conventional long-dated gilts.

Gilt interest payments began lowering following reports on Thursday that a government U-turn on the mini-budget was in the offing.
Newsletter

Related Articles

0:00
0:00
Close
Cornwall Van Dwellers Face Homelessness Risk as Council Tightens Enforcement
Police Investigate Stabbing of Iranian Journalist in London
Rare Copy of US Declaration of Independence Discovered in UK Archive
Department for Education Data Shows Persistent Literacy Gap Among Disadvantaged White Pupils
London Casino Faces Legal Action Over Alleged Tip Distribution Practices
England Records Hottest June on Record as Heatwave Disrupts Services Nationwide
UK Foreign Office Ends Overseas Education Programme for Women and Girls After Shortfall
UK Lawmakers Call for Urgent Action to Preserve Historic Outdoor Lidos
Police Criticise Extended Pub Opening Hours for England World Cup Fixture in Mexico
UK Safety Authorities Warn Parents Over AI-Generated Child Abuse Imagery Risks
Reform UK-Led Council Struggles to Attract Sponsors for Union Flag Promotion Scheme
OpenAI UK Investment Uncertainty Grows After Reported Setback on Stargate Data Centre Site
British Medical Association Warns of Severe Financial Crisis and Possible Staff Cuts
UK Devolution Debate Intensifies as Celtic Nations Prepare Breakup Contingency Plans
Starmer Signals Labour Transition as Burnham Emerges as Potential Successor
UK Government Consults International Partners on Maritime Trade Security and Energy Market Stability
Rare Revolutionary-Era Documents Discovered by UK Archives and Undergoing Authentication
UK Consumer Confidence Remains Deep in Negative Territory as Household Spending Stays Cautious
Transport for London Warns of Severe Disruption as Major Events Converge in Central London
NHS and Social Care Sectors Face Ongoing Recruitment Shortages Amid Persistent Workforce Gaps
Rising Energy Costs Drive Price Pressures Across UK Retail and Service Sectors
Competition and Markets Authority Expands Review of Artificial Intelligence Impact on UK Media Markets
UK Parliamentary Committees Intensify Scrutiny of National Security and Industrial Policy Legislation
Bank of England Faces Persistent Inflation Pressure as Rate Cut Expectations Fade
UK Public Finances Under Pressure as Borrowing Exceeds Forecast and Debt Nears 95% of GDP
Major Police Deployment Across Central London as Mass Demonstrations and Pride Parade Converge
Large-Scale Police Dispersal Powers Activated in Liverpool Ahead of Anti-Immigration Protests and Counter-Demonstrations
Luxury bags take over the World Cup: style, status symbol, or just showing off?
National Productivity Institute Highlights Weak Business Investment Outside Southern England
UK High Court Orders Reassessment of Environmental Impact in Major Highway Project
UK Cyber Security Centre Warns of Rising Threat From State-Sponsored Digital Espionage
UK Education Secretary Launches National Reform of Apprenticeships and Vocational Training
Financial Conduct Authority Tightens Climate Risk Disclosure Requirements for Listed Firms
Rail Union Suspends Planned Strike Action to Enter Formal Negotiations With Operators
Northern Ireland Businesses Seek Clarity Over Post-Brexit Trade Rules
Welsh Government Launches Regional Growth Plan Targeting Transport and Digital Infrastructure
North Sea Wind Sector Attracts £5 Billion Investment Amid Expansion of Offshore Capacity
Scotland and UK Governments Establish New Framework for Coordinated Investment in Energy and Infrastructure
UK Government Launches Major Immigration and Border Policy Overhaul Review
Bank of England Signals Interest Rates to Remain Elevated Despite Easing Inflation Pressures
National Health Service Warns of Severe Winter Capacity Strain Across Hospital Trusts
Chancellor Orders Urgent Treasury Review Amid Concerns Over Structural Public Finance Gap
Prime Minister Unveils Sweeping Legislative Programme Focused on Housing, Health Service Reform and State Energy Plan
UK Parliamentary Committee Launches Inquiry Into Falling Primary School Rolls and Public Service Impact
UK House of Lords Debates Electoral Commission Powers and Political Finance Reform
UK Parliament Considers Expanding Carbon Rules to International Aviation and Shipping Emissions
UK Traffic Commissioner Revokes Hampshire Haulage Operator Licence Over Regulatory Failures
UK Parliament Examines Risks in Public Contracts Awarded to Technology Firm Palantir
UK Competition Watchdog Moves Toward More Flexible Merger Rules to Support Efficiency and Growth
UK Government Seeks Approval for £1.15 Trillion Public Spending Plan Amid Scrutiny Over Department Budgets
×