London close: FTSE 100 retreats from record high as BoE holds rates steady

London close: FTSE 100 retreats after record high as BoE holds rates steady

UK equities ended lower on Thursday as investors locked in profits after a strong rally, reacting to the Bank of England’s interest rate decision and renewed concerns about slowing economic growth. The market mood was further weighed down by steep losses in Frankfurt and Paris and a weak opening on Wall Street.

The FTSE 100 fell 0.4% to 9,735.78, retreating from Wednesday’s record close of 9,777.08. Gains in banking, mining, and retail were offset by declines in major blue-chip stocks including Hikma, Smith & Nephew, Diageo, and Convatec.

Focus on Bank of England decision

The Bank of England’s Monetary Policy Committee narrowly voted five to four to keep interest rates at 4%, breaking from its recent rhythm of rate cuts at alternate meetings. Although the UK economy remains sluggish, the central bank continues to struggle with persistent inflationary pressures.

The consumer price index stands at 3.8%, down from recent highs but still notably above the Bank’s 2% target.

“Today’s decision clearly opens the door to a December cut, but that remains contingent on the incoming data,” said Matt Swannell, chief economic advisor to the EY ITEM Club. “If there are further signs of falling inflationary pressures in the coming months, and if the bulk of the tax rises expected at the Autumn Budget are introduced almost immediately, then there might be a slim majority on the Committee in favour of a Christmas cut.”

Author’s Summary

Investors pulled back after record highs, as the Bank of England held rates steady at 4%, signaling a possible December cut amid lingering inflation concerns.

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Sharecast Sharecast — 2025-11-06

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