Banks buy £36.1bn in new gilts
Demand from banks eager to shore up their liquidity buffers has been a key supportive factor for gilts over the past year, Bank of England figures revealed yesterday. UK banks and building societies bought £36.1bn of gilts in the six months to April, up from £11.4bn in the prior six-month period. Overseas buying of gilts meanwhile fell sharply. “Banks are buying gilts partly under regulatory pressure but also because private sector demand for bank loans remains weak,” Henderson’s Simon Ward said.