FTSE 100 slips as investors weigh inflation data ahead of BoE decision

UK stocks traded lower on Wednesday as investors evaluated the latest inflation figures and housing market data ahead of the Bank of England's upcoming interest rate decision.

The benchmark FTSE 100 index fell 0.14% to 10,479.77 points by 0936 GMT, while the domestically focused FTSE 250 index declined 0.4%.

Losses in consumer staples, utilities, and energy stocks weighed on the broader market.

Inflation holds steady ahead of rate decision

Official data released on Wednesday showed that British inflation remained unchanged in May, providing a key update for policymakers and financial markets ahead of the Bank of England's latest monetary policy announcement.

The Consumer Prices Index rose 2.8% in the 12 months to May 2026, matching the annual rate recorded in April.

The reading came in below economists' expectations of a 3% increase.

Monthly CPIH growth stood at 0.2%, matching the rate seen a year earlier.

The inflation figures prompted traders to slightly scale back expectations for a rate increase later this year.

Consumer staples, utilities, and energy stocks weigh

Consumer staples stocks were among the biggest drags on the market.

British American Tobacco fell 1.7%, contributing to weakness in the sector.

Utilities shares recorded the sharpest decline among major sectors, falling 1.1%.

Energy stocks also came under pressure as oil prices remained steady below $80 a barrel.

Shares of BP and Shell each declined 0.7%.

Banks provide support

Despite broader market weakness, some banking stocks posted gains.

Barclays rose 2% after BofA Global Research increased its price target on the lender.

Standard Chartered also advanced 1.3%, providing support to the financial sector.

House prices record the strongest annual growth

Fresh data from the Office for National Statistics showed that UK house prices recorded their strongest annual growth in more than a year during April 2026.

According to the ONS, average UK house prices increased by 3.8% in the year to April 2026.

This compares with a revised estimate of 0% annual growth in March 2026.

The statistics agency said the latest increase represented the strongest annual rise in house prices since March 2025, before Stamp Duty Land Tax changes took effect in April 2025.

Average house prices increased by 0.7% between March and April 2026. In comparison, prices had fallen 2.9% during the same period a year earlier.

Property transaction levels also remained significantly higher than year-earlier levels, according to the ONS data.

The stronger housing market data boosted homebuilder stocks, which gained 1.5% during the session.

Hays advances following asset sale

Recruitment company Hays rose 1.5% after announcing the sale of its operations in six European countries.

While housing-related stocks and select financial names provided pockets of strength, broader market sentiment remained cautious as investors awaited further guidance from the Bank of England on the outlook for interest rates and the UK economy.

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