19th Dec 2025 06:56
(Alliance News) - London's FTSE 100 is set to open lower on Friday, ahead of UK retail sales and public sector borrowing data, returning some of the stride it made in the wake of Thursday's central bank decisions and US inflation reading.
IG says futures indicate the FTSE 100 to open 35.7 points lower, 0.4%, at 9,802.07 on Friday. The index of London large-caps closed up 63.45 points, 0.7%, at 9,837.77 on Thursday. It has risen 2.0% so far this week.
In New York on Thursday, the Dow Jones Industrial Average added 0.1%, the S&P 500 rose 0.8% and the Nasdaq Composite climbed 1.4%.
In Tokyo, the Nikkei 225 was up 1.0%. In China, the Shanghai Composite rose 0.3%, while the Hang Seng Index advanced 0.7%. Sydney's S&P/ASX 200 added 0.4%.
The Bank of Japan increased its benchmark rate, as expected. The central bank said interest rates were raised by 25 basis points to 0.75% from 0.50%.
"If the outlook presented in the October 2025 outlook report will be realised, the bank, in accordance with improvement in economic activity and prices, will continue to raise the policy interest rate and adjust the degree of monetary accommodation," the BoJ said in a statement.
Earlier Friday, numbers showed Japan's consumer price inflation rate ebbed in November. According to the Statistics Bureau of Japan, consumer prices rose 2.9% annually in November, easing from 3.0% in October, but still loftier than the BoJ's 2% target.
The yield on the 10-year US Treasury widened to 4.14% on Friday morning UK time, from 4.11% late Thursday afternoon. The 30-year yield stretched to 4.82% from 4.79%.
Sterling fell to USD1.3379 early Friday, from USD1.3387 at the time of the London equities close on Thursday. The euro traded at USD1.1719, down from USD1.1730. Against the yen, the buck rose to JPY156.04 from JPY155.46.
The BoJ decision followed a hold by the European Central Bank and a cut by the Bank of England on Thursday.
"Yesterday, the Bank of England cut its policy rate by 25 basis points to 3.75% for the fourth and final time this year. The decision-makers voted 5-4 (the decisive vote came from BoE Governor Andrew Bailey). Bailey emphasised that, based on current data, the key interest rate is likely to continue to fall gradually, but that the decision on further monetary easing will become more difficult," Commerzbank analyst Norman Liebke commented.
"The actual decision can be viewed as cautiously positive for the British pound. In recent years, the Bank of England has often been good for a dovish surprise, but this time, despite the surprise downward shift in inflation and the rather weak labour market figures this week, there was no such surprise."
Sterling traded as high as USD1.3446 on Thursday, rising against the dollar after a tamer than expected US consumer price inflation reading.
The consumer price index rose by 2.7% in November from a year before, slowing from 3.0% in September, the Bureau of Labor Statistics said. Market consensus cited by FXStreet had expected inflation to increase to 3.1% in November.
A barrel of Brent fell to USD59.64 early Friday, from USD60.23 at the time of the London equities close on Thursday. Gold declined to USD4,322.91 an ounce from USD4,370.61.
On Friday's economic calendar, there is UK retail sales and public sector net borrowing at 0700 GMT.
UK consumer confidence edged up ahead of Christmas but remains subdued in the face of cost-of-living pressures, according to new figures.
GfK's long-running consumer confidence index improved by two points to minus 17 for December.
The research showed that all five of the survey's measures increased for the month, bouncing back from a weak November which had been impacted by pre-budget caution.
Friday's UK corporate calendar sees retailer WH Smith publish full-year results.
By Eric Cunha, Alliance News news editor
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