Annuity rates slide further as gilt yields drop

Hargreaves Lansdown said this week's capital market flight from risk had driven gilt yields down further, the consequences of which were now showing up in annuity pricing. It added the current crisis in Spain was also likely to negatively affect rates. Head of pensions research Tom McPhail said the additional pressures on the annuity market - such as Solvency II capital requirements, the European gender neutrality ruling and increasing longevity - all meant rates could be pushed even lower. He said the majority of retirees have small pension pots, and many are risk-averse, meaning the...