FX.co ★ FTSE 100 Rises after Inflation Data

The FTSE 100 edged up on Wednesday, rebounding from a 0.5% decline on Tuesday as UK inflation figures surpassed predictions. May's headline inflation increased to 3.4%, which was higher than anticipated, yet it had a minimal impact on altering market expectations for Bank of England rate cuts. Market participants are still anticipating two rate cuts by the end of the year, with no adjustments expected at the upcoming meeting. Shares of Ocado surged over 4% following the announcement of a new customer fulfilment centre in Spain, which enhances its technology partnership with the supermarket chain Bon Preu. These technology licensing agreements are crucial to Ocado's valuation, taking precedence over its retail sales performance. On the other hand, the elevated inflation data negatively affected the homebuilding sector, with the FTSE 350 housebuilding index dipping by approximately 0.5%. Companies like Howden Joinery also experienced slight declines, highlighting concerns that rising inflation could dampen housing demand or postpone potential rate relief.