Hedge funds became an “amplifier of stress” as firms raced to sell bonds to get hold of cash at the start of the pandemic, which pushed the world to the brink of another financial crash, the deputy governor of financial stability at the Bank of England said.

"Sharp changes in government bond prices, margin call and inability to rollover funding forced substantial sales of government bonds by these players (almost $90bn during March) which in turn generated further falls in government bond markets," said Sir John Cunliffe, speaking at a 9 June webinar hosted by the trade group the Investment Association.