Hedge funds are facing “significant” margin calls from their prime brokers amid volatile markets following President Trump’s imposition of tariffs, the Bank of England has said. While hedge funds had been able to meet these margin calls, their use of leverage could “amplify shocks and cause a jump in illiquidity” if not properly managed, the bank’s financial policy committee said. The probability of adverse events, and the potential severity of their impact, has risen,” it added. Hedge funds have gradually been playing a more important role in the trading of government debt and the use of leverage in UK government bond markets has been increasing, with much of the borrowing concentrated in a small number of funds. • Trump tariffs latest news

Source: The Times April 09, 2025 15:22 UTC