London equities experienced a slight decline on Friday, with the blue-chip FTSE 100 poised to continue its downward trajectory from the previous session, as market enthusiasm waned following a record performance earlier this month. Investors exhibited caution in anticipation of the Bank of England’s forthcoming monetary policy decision next month, as well as the government’s budget announcement scheduled for later in November.

The FTSE 100 and the domestically focused FTSE 250 were down 0.3% each, as of 1210. Nonetheless, both indexes are poised for monthly increases, as the FTSE 100 has reached record highs on several occasions in October, while the midcap index is trading near four-year peaks. Pharmaceuticals, financials, and mining stocks emerged as leading sectoral performers for the month, further supported by a robust commencement to the earnings season from companies such as HSBC and GSK.

Indications of subdued inflation have heightened expectations that the Bank of England may lower interest rates this year. Concurrently, easing trade tensions between the U.S. and China, along with a dovish stance from the U.S. Federal Reserve, have further encouraged risk-taking behavior. Market participants anticipate that Britain’s benchmark interest rate will remain unchanged in November; however, they are factoring in a potential reduction in December, based on data gathered by LSEG.

“A more dovish stance from the Bank of England, especially considering the forthcoming budget and possible tax hikes, may prove advantageous for the FTSE,” remarked Fiona Cincotta. Auto Trader’s shares dipped 3.4% following the announcement of the departure of its operations chief. Fresnillo has agreed to buy Canada’s Probe Gold for C$780 million ($556 million) in cash, marking the gold miner’s expansion into North American markets. The shares of the UK company experienced a modest increase of 1%.