Uk Stocks Decline Before Inflation

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Uk Stocks Decline Before Inflation

UK Stocks Decline As Investors Await Us Inflation Data

Most of the UK stock indexes are down on Wednesday as all the eyes are on the US inflation data. After all, the US monetary policy is closely linked to the US inflation data.

Meanwhile, Smiths Group (OTC:SMGZY) has managed to hit record highs. This development came after the company raised its revenue outlook.

Ftse 100 Gains 0.1% On Wednesday

The FTSE 100 index is down by around 0.1% on Wednesday. At the same time, the FTSE 250 has shed 0.2% of its value.

If we look around, the stocks around the globe are sluggish, which shows investors' hesitation. For now, the forecast is that the core inflation will remain unchanged in October. Right now, there's a 59% chance that the Fed will lower the rate by 25 bps at the December meeting.

As for the annual inflation, it will likely jump from 2.4% in Sep to around 2.6% in Oct. But if it exceeds the 2.6% limit, it will cause turbulence in the market.

After all, Trump's policies will raise inflation numbers. If that happens, it will become difficult for the Fed to lower the rate at this stage.

Both the European and the UK markets have been under pressure ever since Trump won the elections. There's no doubt that Trump will start a trade war starting with a big tariff.

Meanwhile, the inflation is still high in the UK, with a risk that it will drive even higher in the coming months. Now, that's also something that could impact the BoE's rate-easing policy.

Just a week ago, the BoE lowered the policy rate once again which made it the 2nd such instance since 2020. According to the BoE, any more rate cuts will be gradual and data dependant.

The highlight of the day was the Smiths Group, which rallied 10%. Earlier, the stock had touched record highs after releasing a better than expected revenue outlook.

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