The FTSE 100 closed 1.19% higher at 10,816.14 on Thursday, extending its gains for a second consecutive session after the Bank of England kept interest rates unchanged. The FTSE 250 rose 1.17% to 24,352.14.
The Bank’s Monetary Policy Committee voted 6–3 to hold Bank Rate at 3.75%, with three members backing a 25 basis-point increase to 4% as policymakers assessed the recent rise in inflation to 3.1% and the risk of further price pressures.
The Bank said it remained ready to act if necessary to ensure inflation returns sustainably to its 2% target.
Danske Bank expects rates to remain unchanged until June 2027 before cuts resume, although it said a further increase could become necessary if energy prices remain elevated and the UK economy proves more resilient than expected.
Among individual stocks, Next gained 2.5% after reporting higher first-half revenue and profit and forecasting 8.4% growth in group profit for the year to January 2027.
AstraZeneca rose 2.3% after NICE recommended Enhertu, developed with Daiichi Sankyo, for certain patients with HER2-low advanced or metastatic breast cancer.
For markets, Thursday’s rally suggests investors took some comfort from the Bank’s decision to hold, although the 6–3 split and continued inflation risks mean expectations of a future rate increase have not disappeared.
