Markets rally ahead of BoE meeting

In mid-morning trading the FTSE 100 is up 42 points, at 6524, as the Federal Reserve minutes trigger a wave of buying.

ECB flag
Source: Bloomberg

In London buying fever has gripped traders as the Fed's commitment to low interest rates spurs on a bout of bargain hunting. The strong US dollar is keeping imported inflation under control but the struggling eurozone economies could dampen the demand for US goods. The cost of borrowing is cheap and traders have been given the nod that this will continue in the near term, leaving them content to keep buying equities.

Mining companies are on top of the leader board for a change. Mineral extractors are in demand for a mixture of reasons, as metals have bounced back and Glencore’s attempt on Rio Tinto is still circulating around the City.

The Bank of England meeting at noon and the press conference that  follows will be watched carefully. Mark Carney may refuse to commit but, if doppelgänger George Clooney can, what's stopping him?

European equity markets will be eyeing Mario Draghi’s statement from Washington DC, and the pressure is stacking up on the European Central Bank chief to implement an easing plan. He needs to do something big soon in order to prevent a Japan style deflation scenario. 

Recruitment consultant Hays is up 4% as a buoyant jobs market, particularly in the UK, helped revenues.

In the US, we are expecting the Dow Jones to open 20 points higher at 17,024, as the US index futures are still feeling the benefit of the Fed minutes. 

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