BoE and bond vigilantes ‘not responsible for 2022 gilts crisis’
Ex-bank official rejects former PM’s claims that LDIs were primary cause of yield spike
The spike in yields on UK government bonds, or gilts, that followed the 2022 “mini-budget” was not the result of a conspiracy by the Bank of England (BoE) or bond market vigilantes, a former BoE official tells Central Banking.
Last month, former prime minister Liz Truss cited a working paper published in May by BoE economists on liquidity after solvency hedging (LASH) risk. This found that institutions with larger LASH exposures sold substantially higher quantities of gilts during the liability
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