FTSE 100 buoyed by BOE policy outlook

Last week UK yields fell back and that saw the 10 year note yield drop from above 4.60% towards 4.45% by the close on Friday.  At the same time UK money market rates fell at the longer end, so the yield curve steepened. This is all due to a number of leading banks and analysts now calling for at least 2 interest rate cuts this year. Indeed, many now see the Bank of England lowering rates 3 times before the year is out. The BOE is due to meet next week, on Thursday May 8. This has all helped to underpin the FTSE 100 and thwarted any move above 1.3434 in the GBP/USD. The FTSE 100 hit a low on April 7 at 7,544.93. It has since recovered to a high last week, at 8,467.79. Technically speaking, all that stands in the way of it completely reclaiming the upward trend is a level in place at 8,586.92 (76.4% of the 8,908.92-7,544.83 fall). That all said, the index has to get to that level first and that is by no means a certain outcome. The FTSE 100 closed at 8,415.25 on Friday. It is right now priced to reopen this morning around that level