Annuity rates to feel QE hangover for 'many generations'

Jenna Towler
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The after effects of the Bank of England's quantitative easing (QE) programme will continue to plague annuity rates for "many generations" to come, according to MGM Advantage.

The provider said annuity rates have fallen about 15% since the roll outof QE in March 2009.  It explained rates are determined by a number of factors, including the returns available on 15-year UK gilts. Since the introduction of QE, the benchmark 15-year UK gilt return has reduced by 20%. In the same period, annuity rates have fallen by some 15%. Last week, Bank of England governor Mark Carney said there was no case for further QE as the economy recovers. MGM Advantage pensions technical director Andrew Tully said: "There is no doubt the annuity legacy from QE will be felt for ma...

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