FTSE gains ground as Bailey downplays inflation worries

Summarised from 2 outlets · Updated 16 Oct, 17:58 · Archive

The FTSE 100 rose 0.4 per cent on Friday as Bank of England Governor Andrew Bailey said evidence of second-round inflation effects was limited.

The FTSE 100 rose 41.55 points, 0.4 per cent, to 10,881.90 on Friday. The FTSE 250 climbed 109.13 points, 0.5 per cent, to 24,533.90, while the AIM all-share rose 8.03 points, 1.1 per cent, to 773.12. For the week, the FTSE 100 rose 3.1 per cent, the FTSE 250 was up 1.3 per cent, and the AIM all-share was down 0.4 per cent.

Speaking at the International Monetary Fund's annual meeting in Bangkok, Bank of England Governor Andrew Bailey said that evidence of second-round inflation effects was limited. 'To the extent we have seen evidence, it's quite subdued,' Mr Bailey said, adding that 'it's too early'. He also said that BoE policy was already restrictive and that the market had been 'pricing a couple of cuts, and I thought that was probably pretty reasonable'. He added that the UK economy was 'more resilient than we expected it to be'.

Mr Bailey's comments followed remarks by BoE chief economist Huw Pill earlier in the week, who said that four interest rate hikes priced into money markets looked overdone. Bank stocks fell amid fears of a potential tax hit on the sector.

How it is being reported

• FTSE forges ahead but banks stutter on tax threatBank of England Governor Andrew Bailey played down inflation fears, although banks missed out amid fears of a tax hit.Independent Business · 16 Oct, 17:28
• FTSE forges ahead but banks stutter on tax threatBank of England Governor Andrew Bailey played down inflation fears, although banks missed out amid fears of a tax hit.Evening Standard · 16 Oct, 17:28

In this story: Andrew Bailey · Bank of England · Bangkok · International Monetary Fund

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