Closing summary
Our main story today:
UK inflation held steady in August, official figures show, maintaining pressure on households as the Bank of England prepares to keep borrowing costs at elevated levels.
Figures from the Office for National Statistics (ONS) show the annual rate of inflation as measured by the consumer prices index remained at 3.8% last month, the same level as July and matching the forecasts of City economists.
Financial markets are widely predicting that Bank policymakers will keep interest rates on hold at 4% on Thursday amid signs of sustained inflationary pressures at almost twice its official 2% target rate.
The Bank of Canada cut interest rates by a quarter point today, and the US Federal Reserve is expected to make a similar move tonight.
With this, we are signing off. Good-bye! We’ll be back tomorrow.
Wall Street opens flat ahead of widely anticipated Fed rate cut
Wall Street has opened flat ahead of the US Federal Reserve’s interest rate decision tonight.
The FTSE 100 index in London has gained 20 points, or 0.2%, to 9,215 and the Dax in Frankfurt is also 0.2% ahead, while the CAC in Paris has fallen by 0.25% and the FTSE MiB in Milan has lost 1.3%.
The Fed is widely expected to cut rates for the first time this year, by a quarter point.
Victoria Scholar, head of investment at interactive investor said:
British Gas owner Centrica is [near] the top of the UK basket thanks to a broker upgrade from Morgan Stanley while Barratt Redrow is another gainer on earnings. Fresnillo is at the bottom of the leaderboard on weaker precious metal prices.
Meanwhile Trump’s second state visit to the UK is very much dominating the headlines. So far, a $42bn ‘Tech Prosperity Deal’ has been agreed to boost ties between the two nations around AI and technology. Microsoft has promised $31bn in UK investments.
The Fed is in focus, widely anticipated to cut interest rates for the first time this year, a day after Trump’s attempt to fire Fed governor Lisa Cook was blocked by an appeals court. While the rate cut is already priced in, focus will be on the dot plot for guidance around where rates might go next. Barclays is projecting the Fed will signal three rate cuts by year-end.
