This is the third inflation expectations ETF offered by the firm.

Lyxor, part of Societe Generale, has rolled out an exchange-traded fund for investors seeking exposure to inflation expectations.

The Lyxor UK£ 10Y Inflation Expectations UCITS ETF, which is listed on the London Stock Exchange, tracks an index that is designed to rise or fall with the market’s expected inflation rate, and hedge against interest rate changes.

“Traditionally UK bond investors have used index-linked gilts to hedge against inflation, which protect investors by adjusting coupons and capital repayments in line with inflation,” Lyxor said. “However, inflation-linked gilts are sensitive to interest rates. If rising inflation expectations were to translate into higher interest rates, linked gilts are likely to fall in value.”

Adam Laird, head of ETF strategy for Northern Europe at Lyxor ETF, said: “This ETF addresses a growing problem: RPI was at 2.6 per cent in January, its highest level in two and a half years and investors need protection. But when prices rise, interest rates usually follow, which can hurt bond investors. Inflation expectations ETFs are a way to get the protection, but lessen the sting of a central bank rate hike.”

The Lyxor US$ 10Y Inflation Expectations UCITS ETF, launched in April 2016, has $537 million in assets under management.