A crisis in U.K. government debt markets accelerated after a fresh attempt by the Bank of England to extend support to pension funds failed to assuage worried investors, WSJ Pro Bankruptcy reported. The U.K.’s central bank said Monday that it would increase the daily amounts it was willing to buy in long-dated bonds before ending the program it established last month as scheduled on Friday. It also unveiled two types of lending facilities aimed at freeing up cash for pension funds beyond the end of the bond buying. The moves appeared to backfire, with yields on 30-year U.K.

British businesses' expectations for consumer price inflation in one year's time rose to 9.5% last month, up from 8.4% in August, a Bank of England survey showed on Thursday, Reuters reported. The BoE's Decision Maker Panel survey of chief financial officers also showed that businesses expected output prices to rise by 6.6% in the year ahead, up from expectations of 6.5% in August. The survey was conducted between Sept. 2 and 16 and received 2,522 responses. Read more.

The derivatives-based investment strategy that tipped the U.K.’s pension sector into crisis started with good intentions: Help companies fulfill promises they made to employees to pay a steady income through retirement, the Wall Street Journal reported. Behind the push into that strategy, say pension trustees and their advisers, was the Pensions Regulator, the U.K.’s powerful watchdog, charged with safeguarding the savings of millions of private-sector workers. The regulator steered private pension funds to adopt liability-driven investments, known as LDIs, linked to returns on U.K.

Asset managers including Blackrock Inc. and Schroders Plc are limiting institutional investors’ withdrawals from some UK property funds after a wave of requests to move money, Bloomberg News reported. Schroders’ UK Real Estate fund has deferred redemptions due at the start of October to as late as July 2023, which will give the £2.8 billion ($3.2 billion) fund more time to ensure it has enough cash to cover the payments, according to a statement on its website.

British Prime Minister Liz Truss was forced on Monday into a humiliating U-turn after less than a month in power, reversing a cut to the highest rate of income tax that helped spark turmoil in financial markets and a rebellion in her party, Reuters reported. Finance minister Kwasi Kwarteng said the decision was taken with "humility and contrition", after some lawmakers from the ruling Conservative Party reacted with fury to suggestions that public and welfare spending could be cut to fund tax cuts for the richest.

Struggling British fashion retailer Joules Group on Thursday said that its turnaround plan, focused on boosting profitability, was making good progress, weeks after Next Plc abandoned plans to inject funds into the company, Reuters reported. Joules, which sells clothing, footwear and accessories, has been wrestling with finances as consumers turn cautious about spending as surging inflation has fed a cost of living crisis. British inflation was 9.9% in August and expected to rise further, with the cost of living crunch squeezing households' disposable spending.

Prime Minister Liz Truss looked to reassure the British public and rattled investors that her plan to cut taxes wouldn’t lead to prolonged financial instability, arguing in a series of interviews on Thursday that the country had been buffeted by global shocks rather than her government’s reforms and that her policies would result in faster growth, the Wall Street Journal reported. “We had to take decisive action,” Ms. Truss told the British Broadcasting Corp. in her first public comments since the tax plan was presented last Friday.

The Bank of England on Wednesday said it would buy U.K. government bonds with long maturities “on whatever scale is necessary” in an effort to restore order to the market after a large set of government tax cuts sent borrowing costs soaring, the Wall Street Journal reported. The furious selloff in U.K. government debt in recent days ripped through normally staid parts of the financial markets. Pension funds and insurers who hold financial derivatives tied to U.K. debt in particular faced the possibility of severe losses, according to analysts.

Turmoil in British financial markets forced mortgage lenders to temporarily withdraw and reprice products for new customers on Monday, a real-world consequence of the market volatility thrown up by finance minister Kwasi Kwarteng's mini-budget last week, Reuters reported. Brokers said that the moves were likely just the start of a big shift in Britain's mortgage market. The country's largest mortgage lender Halifax said it was withdrawing its fee-paying mortgage products - where borrowers could pay an arrangement fee in exchange for a lower interest rate - and moving to a full fee-free range.

Bank of England Governor Andrew Bailey said on Monday that the BoE "will not hesitate" to raise interest rates if needed to meet its 2% inflation target, and that it was watching financial markets "very closely" following sharp moves in asset prices, Reuters reported. Sterling fell to a record low against the U.S. dollar earlier on Monday in Asian trading, extending losses that had accelerated on Friday after finance minister Kwasi Kwarteng gave his first fiscal statement, promising big tax cuts.