Annuity Rates, Annuities, Pensions, Divorce Free Fixed Term Quote
Home News Annuity Rates Annuities Pension Annuity Impaired Annuity Annuity Quotes Pensions Divorce Resources
   


15 June 2012 last updated
Standard annuity rates fall as BoE announces stimulus package

The Bank of England is to introduce two stimulus packages to help the economy and this will reduce the yields on gilts pushing annuity rates lower.

Canada Life has reduced their standard annuity rates by 1% as the 15-year gilt yields reduce by 6 basis points after yields reached the highest point for the month.

Gilt yields reached 2.32% on Wednesday this week and have now reduced to 2.25% and as a general rule a 6 basis point reduction in yields will result in a 0.6% fall in annuities.

Canada Life has 30% of the leading pension annuity rates with funds of £100,000 and the fall in their rates does not change their position as other providers such as Legal & General and Aviva have already made reductions. This is part of the long term fall in rates as the Bank of England prepares for the next round injecting money to boost the UK economy.

 
Annuity rates lower with stimulus package
 
  More annuity topics
  June News 2012
  News & articles
  Archive news stories
  Flexi-access drawdown
  Annuity rates tables
  Outlook for 2016
  Annuity rates charts
  15-year gilt yields
  Latest annuity rates
 

Bank of England more stimulus

Gilt yields suffered today with the announcement from the Bank of England to launch two stimulus packages for the UK and threatens further reduction in annuities and lower income for pensioners. The Bank of England will provide billions of cheap loans direct to banks to lend to customers and companies rather than using their current stimulus package of quantitative easing (QE). QE has provided £325 billion and requires the BoE to purchase Government bonds with the intention of increasing the supply of money to institutions which can be used to purchase other assets.

The governor Sir Mervyn King is concerned with the developments in the Eurozone which have increased the cost of funding in the banking sector and the new stimulus is designed to counter this problem for the next several of years. The first part of the scheme will see an increase to lending of £80 billion and the second part called the Extended Collateral Term Repo Facility outlined in December 2011 would allow banks to borrow up to £5 billion a month to help with liquidity shortages.

The European Central Bank (ECB) has also said it is ready to support the banking system in the Eurozone and as a result equity markets have been buoyant with European markets up about 1.0%, the FTSE-100 index up 10 points to end at 5,478 with the Dow Jones up 115 at 12,767. There has been a trend with stimulus packages since the financial crisis began and markets have always increased in value as a result. This could mean that pensioners retiring remaining in equities will benefit with increasing fund values and would mean a boost in the income they can receive from an annuity.

News related stories:
Annuity rates may lower if UK inflation fall leads to more QE
Annuity rates under threat as Bank of England injects £50 billion of QE
UK annuity rates lower with new QE as inflation falls
Retirement income from annuities may be hit with QE measures by BoE
UK pension annuity income may reduce with lower inflation and QE
Related internet links:
BBC - Bank of England new business support plans
BBC - ECB ready to act where needed
Annuity Rates
  Age Single Joint  
  55 £4,216 £3,974  
  60 £4,702 £4,423  
  65 £5,453 £5,013  
  70 £6,105 £5,482  
£100,000 purchase, level rates, standard
Unisex rates and joint life basis
  Annuity Rates  
Annuity Quotes
  Plan your annuity and get quotes from the 12 leading providers  
 
  free annuity quote Free Annuity Quotes
  annuity quote no obligation No Obligation
  annuity quote all providers From All Providers
 
  Annuity Quote  
  Annuity Rates News:

Gilt yields lower due to North Korea
Latest annuity rates could fall Uncertainty over North Korea sends investors to gilt and bond safe havens
Retirement income up 21% since Brexit
Retirement income rise after Brexit vote Higher equity markets and gilt yields has seen income from pensions 21% higher
Pension freedoms help raise fund sizes
Pension freedoms help funds soar to £50,000 Pension fund sizes reach 50,000 with a little help from pension freedoms
Pension freedoms tax receipts at 1.5bn
Pension freedoms tax receipts are £1.5bn Pension freedoms have raised more tax for the HMRC than expected

  Follow Us:
You can follow the latest annuity updates on Twitter or as a fan on Facebook and Google+
  Facebook Page Twitter Page Twitter Page
Sharingpensions.co.uk   This website is for marketing purposes only and does not provide specific financial or legal advice. Website security issued by GeoTrust and Equifax. Copyright©2001-17 Sharingpensions.co.uk. All Rights Reserved