The Bank of England left interest rates unchanged, keeping in line with money manager expectations that any further rate cuts would not be made because the impact of Brexit has not yet been felt.
The bank's Monetary Policy Committee made the unanimous decision Thursday to maintain rates at 0.25% and the current level of quantitative easing.
Managers said the economy slowed in the third quarter, but did not fall into recession.
However, a further rate cut could be announced in November, said Ian Kernohan, economist at Royal London Asset Management, in a news release.
The impact on pension funds of long-term low interest rates was noted by Charles Cowling, director at JLT Employee Benefits. “If we see interest rates stay at current record lows for the next five years, this is not good news for pension schemes. As a result, there are going to be inexorable demands on employers for significant increases to cash funding of pension schemes," he said in a release.
Raj Mody, global head of pensions at PricewaterhouseCoopers, added in a PwC release that pension funds should revisit their approach to how they measure their own deficit, and question whether gilt yield-linked measures are still entirely relevant for them.
