Bank of England Live: FTSE 100 hits new high as interest rates to be held
Welcome back to the City AM FTSE 100 liveblog.
It’s Thursday morning and the Bank of England is expected to hold interest rates when its Monetary Policy Committee (MPC) announces its decision at 12pm today.
Analysts across financial firms in the City are expecting the MPC to leave interest rates unchanged at 3.75 per cent. But the Bank could roll the pitch for a series of interest rate hikes this year after price shocks triggered by the war in Iran rippled through the global economy.
The Bank has been grappling with higher and more persistent inflation fuelled by a spike in energy prices brought on by the war in Iran. In a report published this week, the independent think tank NIESR said inflation would likely remain above the Bank’s two percent target until 2029 under even a benign scenario where hostilities cool and oil prices level out at $74 per barrel. .
Peel Hunt’s Kallum Pickering agreed that a narrower split on the MPC would be the “clearer signal” that interest rate hikes were set to come, though this was a “tail risk” rather than a central hypothesis.
The FTSE 100 jumped again this morning after hitting its highest-ever level on Wednesday, reaching a new record of 10,971. The blue-chip index was buoyed by a four per cent rise at Rolls Royce, which lifted its targets after posting a near-50-per-cent jump in operating profit.
UK investors brushed off the fresh flare-up in tensions in the Middle East. The US launched a volley of attacks against Iran overnight, after President Trump told Fox News he would give Tehran “a beating” after it launched “surprise” attacks against US forces in the Middle East.
We’ll be bringing you the latest market updates and analysis as the day develops.
Jump straight to:
- 8:58am: FTSE 100 climbs after shaky start
- 8:37am: Rolls Royce shares jump after profit boost
- 8:08am: Lloyds beats profit target as bank sets sights on more cost-cutting
- 7:35am: Shell launches bumper buyback after earnings buoyed by Middle East
- 7:10am: Oil rises again as US resumes heavy strikes on Iran