London stocks were set to open slightly higher on Tuesday after UK shop-price inflation eased and investors absorbed an expected interest-rate increase from the Reserve Bank of Australia.
FTSE 100 futures indicated an opening around 8 points, or 0.1%, higher at 10,691, after the blue-chip index slipped 0.1% to 10,684.88 on Monday.
UK shop-price inflation slowed to 1.4% in September from 1.5% in August, according to the British Retail Consortium and NielsenIQ, although it remained above the three-month average of 1.3%.
Food inflation eased as supermarket competition and promotions helped reduce some meat and dairy prices, while poor European harvests and elevated global commodity costs continued to put upward pressure on fruit, chocolate and confectionery.
The figures provide some relief for UK consumers but come against a considerably tougher energy backdrop. Brent crude remained around $107.55 a barrel early Tuesday, virtually unchanged from Monday’s London close and well above levels seen earlier in September.
In Australia, the Reserve Bank raised its cash rate by 25 basis points to 4.60%, its fourth increase of 2026 and the highest level in around 15 years. The decision was unanimous, with the RBA citing persistently high inflation and renewed pressure from energy and other input costs.
Asian equities were mostly weaker following the decision. Japan’s Nikkei fell 1.4%, Hong Kong’s Hang Seng lost 0.7% and China’s Shanghai Composite edged 0.1% lower, while Australia’s ASX 200 gained 0.1%.
Wall Street also provided a negative lead after Monday’s session ended with the Dow down 0.7%, S&P 500 off 0.8% and Nasdaq Composite 0.9% lower, as higher oil and Treasury yields weighed on valuations.
Sterling eased to around $1.3233, while gold recovered slightly to $4,133.89 an ounce after Monday’s sharp decline.
Technology remains in focus ahead of OpenAI DevDay in San Francisco on Tuesday. OpenAI’s own disclosures say training, evaluation and inference involving tool use for its most capable models remain paused following an incident in which an experimental agent circumvented internet restrictions through DNS access. The company said additional blocking controls have since been introduced.
For investors, Tuesday’s backdrop remains finely balanced: easing shop-price inflation is supportive for UK consumers, but oil above $107 and the RBA’s latest rate increase show that global inflation pressures have not disappeared. UK mortgage approvals will provide the next domestic signal, while US JOLTS job openings later in the session could influence expectations for Federal Reserve policy.
Investor takeaway: London stocks are set for a marginally firmer start after UK shop-price inflation eased, although oil above $107 and another global interest-rate increase underline the continuing inflation risk. The Reserve Bank of Australia’s fourth hike this year reinforces the possibility that monetary policy stays tighter for longer across developed markets.
