Gilts see muted reaction to UK inflation print
U.K. government bonds, known as gilts, strengthened slightly after inflation came in in line with analysts’ expectations.
The yield on the benchmark 10-year gilt was around 2 basis points lower by 7:07 a.m. in London. Yields on 2- and 20-year gilts were down by around 1 basis point, while 5- and 30-year gilt yields remained unchanged.
Bond prices and yields move in opposite directions.
— Chloe Taylor
UK inflation cools to 3.4% in May, as expected
U.K. inflation cooled slightly to 3.4% in the year to May, data from Britain’s Office for National Statistics showed on Wednesday.
The reading was in line with analyst expectations.
A month earlier, inflation unexpectedly surged to 3.5%.
— Chloe Taylor
Good morning, here are the opening calls
A view of the London skyline during sunrise looking east, including Canary Wharf, from Horizon 22, London’s highest free viewing platform. Picture date: Friday September 15, 2023.
Yui Mok – Pa Images | Pa Images | Getty Images
Good morning and welcome to CNBC’s live blog covering European financial market action and the latest regional and global business news, data and earnings.
Futures data from IG suggests sharp falls across European markets at the open, with London’s FTSE looking set to open 52 points lower at 8,827, Germany’s DAX down 245 points at 23,447, France’s CAC 40 down 75 points at 7,665 and Italy’s FTSE MIB 329 points lower at 39,568.
Global investors continue to assess ongoing fighting between Israel and Iran tensions after continued missile attacks and airstrikes on Monday.
Oil prices have risen on supply worries, and the price of gold has also increased amid a flight to safe haven assets after the conflict erupted last week.
Those prices rose further overnight, and U.S. stock futures turned lower, after U.S. President Donald Trump signaled a further escalation in attacks could be coming as he urged Iranians to evacuate Tehran.
— Holly Ellyatt
What to look out for on Wednesday
The U.S. Federal Reserve’s latest monetary policy decision is due Wednesday afternoon. Fed funds futures are pricing in an almost 100% likelihood that the central bank will keep rates unchanged, as per CME’s FedWatch tool, despite U.S. President Donald Trump’s continued pressure on Fed Chief Jerome Powell for a rate cut.
Television stations broadcast Jerome Powell, chairman of the U.S. Federal Reserve, speaking after a Federal Open Market Committee meeting, on the floor of the New York Stock Exchange on May 7, 2025.
Michael Nagle | Bloomberg | Getty Images
Investors will be keeping a close eye on Powell’s post-meeting comments and for the central bank policymakers’ forecast on rate policy, as the Federal Open Market Committee will be sharing members’ “dot plot” of rate expectations.
In Europe, U.K. investors will be keeping a close eye on inflation data from the U.K. for May, with economists expecting the consumer price index to have risen 3.4% in the year to May. Elsewhere, Sweden’s Riksbank publishes its latest interest rate decision on Wednesday.
There are no other data or major earnings reports due.
— Holly Ellyatt
