The Bank of England (BoE) is reinforcing its bond buying scheme in an effort to further support the economy.
New measures are being introduced for the final week of the purchase scheme, which will end on Friday (14 October).
Firstly, the BoE will increase the size of its daily auctions, doubling the limit of Government bonds that it can purchase per day from £5 billion to £10 billion.
The Bank offered to buy up to £40bn over the course of the scheme, but had only made £5bn of bond purchases as of 10 October.
The scheme was first introduced as an emergency measure after the Government's mini budget announcement disrupted the financial markets.
Banks will also be able to ease liquidity pressures facing client liability driven investment (LDI) funds by accepting collateral eligible under the sterling monetary framework, including index linked gilts.
The BoE will also use its weekly indexed long term repo operations to support further easing of liquidity measures facing LDI funds.
The BoE said:
"Beyond the end of this week's operations, the Bank will continue to work with the UK authorities and regulators to ensure that the LDI industry operates on a more resilient basis in future."
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