UK’s blue-chip FTSE 100 was steady on Wednesday as investors digested mixed earnings reports. While caution reigned in global markets ahead of U.S. inflation data that could keep the Federal Reserve; on course for aggressive interest rate hikes.
The FTSE 100 (.FTSE) inched up 0.04%, holding just below a two-month peak hit. While the midcap FTSE 250 index (.FTMC) gained 0.4%.
Global markets treaded water as investors were reluctant to place big bets ahead of the release of U.S. inflation data, which is expected to have risen at a much slower pace in July due to a sharp drop in the cost of gasoline.
The report, however, is still likely to show that underlying inflation pressures remained elevated as the Fed mulls whether to embrace another super-sized interest rate hike in September.
“Even if the inflation cools slightly, the Fed will look to press ahead with a 75 bps next month because they’re confident that the labour market can withstand another rate hike,” said David Madden, market analyst at Equiti Capital.