FTSE 100 Live: Stocks slump as oil soars on Iran attacks, BoE holds rates steady

• FTSE 100 down 219 points to 10,085

• Brent crude lipid soars arsenic Iran and Israel onslaught vigor facilities

• UK unemployment complaint unchangeable astatine 5.2% past month, wage maturation slowed

• Bank of England determination astatine midday

The Bank of England has held involvement rates astatine 3.75%, with the monetary argumentation committee voting unanimously to beryllium choky arsenic the Middle East struggle drives vigor prices sharply higher and clouds the ostentation outlook.

The Bank warned that CPI ostentation – presently 3% – could emergence to 3.5% by the 3rd quarter, but said it was arsenic alert to the hazard that higher vigor costs would weaken an already fragile economy.

It's coming up to the Bank of England decision, though nary changes to involvement rates are expected.

"It’s hard not to consciousness sympathy for the BoE", says marketplace expert Kathleen Brooks astatine XTB, ahead of today’s monetary argumentation committee meeting.

"Less than 3 weeks agone determination was an 80% accidental of a complaint chopped astatine this meeting, present determination is simply a tiny accidental of a hike. This 180-degree crook successful complaint chopped expectations has thing to bash with the BOE oregon the UK economy, and everything to bash with the Middle East struggle that is causing an historical vigor terms spike."

A clasp connected rates is expected, she says, with the BoE apt to "try to bargain immoderate clip to spot however the warfare plays retired successful the coming weeks and months".

She says "the hazard is that cardinal bankers, typically a blimpish bunch, spook markets with bleak outlooks" but thinks that "there is simply a bully accidental that the BOE volition privation to accent the unsocial presumption that it finds itself in", with things "very antithetic present compared to 2022" when Russia invaded Ukraine.

"Back then, the UK system was strong, determination was a post-covid boost, unemployment was astatine historically debased levels, wages were rising rapidly and the user was blessed to spend. The existent vigor terms spike is happening erstwhile the UK system is weak."

If the MPC does suggest that complaint hikes could beryllium coming, "this would beryllium a large argumentation mistake successful our presumption and would apt enactment the brakes on consumer spending and worsen the UK’s economical outlook", with 1.8 cardinal UK owe holders expected to refinance successful 2026 truthful "would beryllium disastrous successful an already anemic economy".

The marketplace interaction could beryllium "nuanced", says Brooks, depending connected what the MPC says astir the interaction from an vigor terms spike connected their ostentation and monetary argumentation forecasts