Bank of England alarm as hedge fund gilt bets hit £100bn

Bank data show hedge funds had borrowed £99.9bn from banks to recycle back into gilts as of the end of November, a 10-fold increase compared with just over a year ago, when the figure was less than £10bn.
Chris Coghlan, a Liberal Democrat MP who sits on the select committee, highlighted a warning by the Bank that a small number of predominantly US hedge funds were now responsible for 90pc of all net borrowing.
Bank officials have warned a sudden economic or financial shock could trigger “fire sales” in gilts, plunging financial markets into turmoil.

Bank of England alarm as hedge fund gilt bets hit £100bn
byu/The_Sun_is_a_Star ininvesting

Posted by The_Sun_is_a_Star

tech_22_fusiondaily on January 19, 2026 12:27 am

A ten‑fold increase in leveraged gilt positions in just a year is a real concentration risk. When a small group of funds accounts for most of the borrowing, any shock can force rapid unwinding, and that’s exactly the kind of setup that leads to fire‑sale dynamics

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