The accounting deficit of defined benefit (DB) pension schemes across the UK’s 350 largest listed companies increased by £2bn during August, according to Mercer’s latest Pensions Risk Survey data.

This left the DB pension scheme deficit, including other post-retirement benefit plans, to stand at £87bn at the end of the month, an increase on £85bn at the end of July.

Mercer revealed that this rise was driven by a £6bn increase in liabilities to £934bn compared to £928bn at the end of July, caused by a rise in market expectations for future inflation, offset by a rise in corporate bond yields. Asset values climbed from £843bn at the end of July to reach £847bn at the end of August.

The Pensions Risk Survey uses data relating to around 50% of all UK pension scheme liabilities, with Mercer’s analysis focused on pension deficits calculated using the approach that companies adopt for their corporate accounts.

Mercer UK wealth trustee leader, Tess Page, said: “We’ve seen strong economic growth in recent months, but looking ahead the global economy faces challenges – COVID is back on the rise in many regions, and in the UK the winding down of government support may weigh on growth.

“The last month saw fairly small changes to aggregate funding levels, but the course ahead could well be a choppy one. Schemes with clear integrated risk management strategies will be well-prepared for the future.”

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