UK Economy 17 December 2025 - 2 January 2026

The UK stock market is closed today, but investors are heading into the Christmas-shortened trading week with the FTSE 100 firmly in “near-10,000” territory, a fresh Bank of England rate cut, and a growing debate about whether 2026 marks the year the UK’s long-running valuation discount finally starts to close. Friday’s cash-market finish left London equities on a strong footing: the FTSE 100 ended at 9,897.42, while the more domestically sensitive FTSE 250 closed at 22,312.71 on Hargreaves Lansdown’s delayed pricing. Hargreaves Lansdown+1

London equities traded cautiously higher by mid-morning on Thursday as investors positioned for the Bank of England’s final policy decision of 2025, due at 12:00 GMT. With UK inflation cooling faster than expected and growth showing fresh signs of strain, the market is braced for a widely expected 25-basis-point rate cut—but traders are watching just as closely for what comes after the cut: the vote split, the tone of the minutes, and whether policymakers hint at further easing in 2026. Reuters+2Bank of England+2 By around 10:45 AM GMT, the FTSE 100 hovered around the 9,800 mark, up roughly 0.3%, while the more UK-focused FTSE 250 rose about 0.36%. Retailers and defence names led the gains, while miners and healthcare lagged—classic “wait-and-see” positioning before a major central bank event. Reuters+2Hargreaves Lansdown+2