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Bank of England intervenes in bond market

The Bank of England has warned of a risk to the UK’s financial stability as it steps in again to buy more government debt and stabilise markets

Bonds also known as gilts allow the government to raise money to pay for spending by borrowing from investors.

The Bank launched an emergency plan to buy them after the chancellor’s “mini-budget” in late September because investors were selling them off.

The government’s plan to fund tax cuts with large borrowing spooked markets, with the pound plunging.

Many pension funds hold government bonds as they are traditionally seen as a very safe asset.

Despite the latest warnings, Deputy Prime Minister Therese Coffey says she is “absolutely confident pensions are safe”.

Writing by Omotola Oguneye