FTSE 100 Live: UK inflation falls before US Fed and Bank of England rate decisions

The latest updates on the FTSE 100 and London’s financial markets from City A.M.’s newsroom in the heart of the City of London.

Overnight, on Wall Street, the S&P 500 index rose by 0.6 per cent, led by an 11 per cent gain in International Paper’s stocks, while Super Micro Computer dropped nearly 9 per cent. The Nasdaq Composite also increased by 0.4 per cent. 

Asia’s markets were mixed, with Tokyo’s Nikkei remaining closed for a holiday. Oil prices retreated due to a stronger US dollar, with Brent crude at $87.14 per barrel and U.S. crude at $83.11 per barrel. Gold prices remained steady at $2,158.3 per ounce. 

Bitcoin and Ether rallies stalled, with Bitcoin dropping over 5.0 per cent to $62,766 and Ether falling to $3,147.5, its lowest in over three weeks. Despite this, Bitcoin has surged nearly 50 per cent since the year began, driven by investor interest in U.S. exchange-traded funds. 

China opted to keep its key lending rates unchanged during the monthly fixing on Wednesday, in line with market expectations. The one-year loan prime rate (LPR) remained at 3.45 per cent, while the five-year LPR held steady at 3.95 per cent.  

XpertHR reports British employers have lowered projected pay increases for 2024 to 4 per cent, signalling potential inflation easing over the coming months.  

Brits woke up to some good news, with UK February inflation data showing a sharp fall, ahead of the US Federal Reserve’s meeting. 

The Office for National Statistics was anticipated to report a slowdown in the year-on-year growth of headline consumer prices in the UK, decreasing from 4.0 per cent in January to 3.5 per cent in February. 

Inflation fell faster than expected last month, dropping to its lowest level in nearly two and a half years.

Following that, all eyes are on the US Federal Reserve’s monetary policy announcement later today.

While it’s expected that the Fed will maintain interest rates within the 5.25 per cent -5.50 per cent range, investors eagerly await Chair Powell’s remarks and the release of the Fed’s dot-plot, offering insights into future interest rate trajectories.