Bank of England says launching temporary expanded collateral repo facility

via Reuters:

• Bank of England Bank of England The Bank of England (BoE) functions as the United Kingdom’s central bank and is one of the key drivers of monetary policy in Europe. As one of the world’s oldest central banks and established in 1694, the BoE is owned by the British government. Its central mandate involves maintaining and targeting interest rates while using other tools to help either stimulate or contract the economy. Moreover, the BoE is responsible for producing the UK’s bank notes as well as supervising key bank payment sy The Bank of England (BoE) functions as the United Kingdom’s central bank and is one of the key drivers of monetary policy in Europe. As one of the world’s oldest central banks and established in 1694, the BoE is owned by the British government. Its central mandate involves maintaining and targeting interest rates while using other tools to help either stimulate or contract the economy. Moreover, the BoE is responsible for producing the UK’s bank notes as well as supervising key bank payment sy Read this Term says facility is to enable banks ease liquidity Liquidity Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Read this Term pressures facing their client LDI funds through liquidity insurance ops

• In final week of operations, the Bank is announcing additional measures to support an orderly end of its purchase scheme

• Bank will stand ready to increase the size of its daily auctions to ensure there is sufficient capacity for gilt purchases ahead of Friday 14 October

• Maximum auction size will be confirmed each morning at 9am and will be set at up to £10bn in today's operation.

• Bank's existing reserve pricing mechanism will remain in operation during this period.

• Bank will also stand ready through its regular indexed long term repo operations each Tuesday to support further easing of liquidity pressures facing LDI funds

• Bank will continue to work with UK authorities and regulators to ensure that ldi industry operates on a more resilient basis in future.

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These measures are to support UK pension funds & gilt markets. Should ease pressure on GBP selling.

Text is here: Bank of England announces additional measures to support market functioning

Bank of England Governor Bailey