This increase was only partially offset by increases in pension fund asset values. At the end of August, FTSE 350 pension scheme accounting deficits stood at £63 billion, a funding ratio of assets over liabilities of 89%.
“Over the month, the yield on high quality corporate bonds remained virtually unchanged but the market’s expectation for long-term inflation increased marginally,” the consultancy said in a statement.
The net effect was an increase in liabilities of about 1% over the month to £576 billion. Meanwhile, asset values increased from £510 billion to £513bn to offset the increase in liabilities to some extent.
©2012 fund europe