M&G launch prompts banks to consider inflation-linked issues

The launch of the M&G Inflation Linked Corporate Bond fund is already making waves in the fixed income markets, as potential issuers approach the group with plans to enter the space.

Although the size of the inflation-linked corporate bond market currently stands at just £15bn, M&G's head of fixed income retail Jim Leaviss expects rapid expansion in this area as investors look for protection against inflation. Leaviss, who runs the new fund with Ben Lord, says the group has already been approached by a number of banks looking to issue these instruments. "The launch of the fund has provoked issuers to think ‘actually, this might be something of interest for us'," Leaviss says. "So we have had a number of people, including a couple of high street banks, contact u...