The benchmark index experienced an increase of 0.2% by 1013, whereas the domestically focused index saw a rise of 0.4%. British stocks saw a modest increase on Wednesday, recovering from the previous day’s losses, as investors looked forward to the U.S. Federal Reserve’s policy decision at the end of its two-day meeting later in the day.
The U.S. central bank is expected to reduce borrowing costs by at least 25 basis points at 2 P.M., in light of various economic indicators pointing to a weakening jobs market. Market participants will closely examine Chair Jerome Powell’s comments for clues regarding the Federal Reserve’s interest rate trajectory. Meanwhile, data released on Wednesday indicated that British inflation remained stable at 3.8% in August, the highest among major advanced economies, reinforcing expectations that the Bank of England will delay interest rate cuts until next year.
The rise in food prices, seen by the Bank of England as vital for shaping public inflation expectations, marked the largest increase since January of last year.
“This morning’s UK inflation data strengthens our view that the BoE is not expected to lower rates again for the remainder of 2025,” remarked Matthew Ryan. “With swap markets showing no expectation of rate changes from the MPC on Thursday, investors will focus on the bank’s rate guidance.” The personal goods sector experienced the highest increase, rising by 4.9%, with Burberry leading the charge at a gain of 5.5%. Centrica was one of the leading gainers in the FTSE 100, rising by 3.7%, following Morgan Stanley’s designation of the energy company as a top pick.
Ben & Jerry’s co-founder Jerry Greenfield has left the company after a disagreement with parent Unilever, as shares show volatility in early trading. PRS REIT experienced a 6.1% increase following the announcement of its intention to sell its operating unit to Waypoint Asset Management for 646.2 million pounds ($881 million). Additionally, U.S. President Donald Trump officially begins his second state visit to Britain on Wednesday.