FTSE 100 Edges Higher Amid Inflation Speed Bumps

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, was trading rose around 0.23% on 22 January 2026. 

Macro Update: UK macro news highlights a surprise inflation rise to 3.4% in December, driven by airfares and tobacco prices, though it is viewed as a temporary "speed-bump". The Bank of England is expected to hold interest rates steady at its February 5 meeting, with rate cuts likely later in 2026 as price pressures ease. Separately, government borrowing fell sharply in December, while the labour market shows a steady unemployment rate of 5.1%. 

Top Market Movers: Among top gainers on FTSE 100 index, ST. James’s Place (LSE: STJ) witnessed a rise of 3.42% followed by Hiscox Ltd (LSE: HSX) which gained around 2.69%. 

Commodity Update: Commodity Update: The U.S. dollar held onto overnight gains against major peers on Thursday after President Donald Trump withdrew earlier tariff threats against several European NATO nations, easing trade-related concerns. Gold declined 1.06% to USD 4,786.20, while silver slipped 0.09% to USD 92.55. Copper rose 0.56% to USD 12,823.90. Brent crude edged up 0.15% to USD 65.34, supported by reduced trade tensions and a steadier global demand outlook.  

Our Stance: Our stance remains cautious due to persistent inflation and a slowing labor market. While rate cuts are anticipated later in 2026, the immediate focus is on managing current economic pressures and the temporary inflation rise, which may delay immediate action by the Bank of England. 

FTSE 100: The FTSE 100 advanced 71.81 points to trade at 10,209.90, while continuing to hold above the key support zone near 9,800, maintaining a stable broader structure. The 21-day and 50-day Simple Moving Averages remain positioned below current levels, providing underlying support and leaving scope for near-term consolidation. Momentum has softened, with the RSI reflecting waning strength. Immediate support is located around 8,950, while upside resistance is seen near 10,250 and 10,400. 

Source: Charts by REFENITIVD