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Sterling was volatile on Thursday after the Bank of England (BoE) raised interest rates and said it expects the surge in British inflation to cool faster than before. Despite a surprise jump in price growth announced on Wednesday, the BoE raised interest rates by a further quarter of a percentage point on Thursday to 4.25% and kept unchanged its message that its Monetary Policy Committee saw less urgency about maintaining its fast run of rate hikes. Sounding more upbeat about the outlook for the country's slow pace of economic growth, the BoE's nine rate-setters voted 7-2 in favour of a 25 basis-point increase in Bank Rate.
The latest investor updates on stocks that are trending on Thursday.
Millions of mortgage holders to see their monthly payments rise as interest rates are hiked yet again.
Stock futures nudge higher as Fed hints at rate hike pause; Yellen says no plan for 'blanket' bank deposit insurance' from Treasury; Coinbase shares tumble after crypto exchange gets SEC Wells Notice; Swiss National Bank hikes rates, says bank crisis 'halted and Boeing confirms $2.5 billion 737 Max deal with Japan Airlines.
Banks and stronger pound send FTSE 100 lower.
By Geoffrey Smith
Citigroup trimmed its 2023 year-end forecast for the pan-European STOXX 600 index by more than 5% to 445 points, which represents a 0.4% downside from current levels. Citi also cut its forecast for UK's FTSE 100 index by 5%, now expecting the blue-chip index to end the year at 7,600 points, less than 1% higher from current levels.
European stock markets weakened Thursday as investors digested the latest interest rate increase by the U.S. Federal Reserve ahead of a policy-setting meeting by the Bank of England. The Fed raised its benchmark interest rate by 25 basis points as widely expected, forecasting at least one more hike this year, and saying it has no intention of cutting interest rates this year. Adding to the negative tone were comments from Treasury Secretary Janet Yellen, as she said the government "is not considering insuring all uninsured bank deposits".
European stock markets are expected to open in a mixed fashion Thursday as investors digest the latest interest rate increase by the U.S. Federal Reserve ahead of a policy-setting meeting by the Bank of England. At 03:00 ET (07:00 GMT), the DAX futures contract in Germany traded 0.3% lower, the FTSE 100 futures contract in the U.K. fell 0.2%, while CAC 40 futures in France climbed 0.6%. This Fed raised its benchmark interest rate by 25 basis points as widely expected, forecasting at least one more hike this year, and saying it has no intention of cutting interest rates this year.
The Federal Reserve has raised US interest rates for the ninth time in a row despite turmoil in the country's banking system.