The demand for safe-haven assets such as UK gilts has reached such proportions that it is creating problems for pension funds' investment strategies, according to the consultants that advise them. On Monday, the real yield on UK inflation-linked bonds turned briefly negative, a highly unusual situation.

Because most pensions are linked to inflation, those responsible for retirement funds like to cover themselves against rises in the years ahead. They do a lot of that by buying inflation-linked bonds from the government, which promise to pay out a yield tied to the rate of inflation.