The Bank of England has widened its buying programme to include index-linked gilts in an effort to counter what it warned was “dysfunction” in the market, a day after a sell-off in UK government bonds pushed up the country’s long-term borrowing costs.

In a statement on Tuesday, the BoE said the additional move would “act as a further backstop to restore orderly market conditions by temporarily absorbing selling of index-linked gilts in excess of market intermediation capacity”.

“The beginning of this week has seen a further significant repricing of UK government debt, particularly index-linked gilts. Dysfunction in this market, and the prospect of self-reinforcing ‘fire sale’ dynamics, pose a material risk to UK financial stability,” the Bank said.