BUZZ-UK homebuilders fall as inflation jump underscores BoE stance for gradual rate cuts

Reuters2024-11-20
BUZZ-UK homebuilders fall as inflation jump underscores BoE stance for gradual rate cuts

** UK housebuilders' index .FTNMX402020 declines over 3% after British inflation jumped by more than expected last month to rise back above the Bank of England's 2% target; underlying price growth gathered speed too, showing why the central bank is moving cautiously on interest rate cuts

** Consumer prices rose by an annual 2.3% in October, pushed up almost entirely by an increase in regulated domestic energy tariffs, after a 1.7% rise in September

** Services inflation - which the BoE views as a key measure of domestically generated price pressure - rose to 5.0% in October from 4.9% in September, the Office for National Statistics said, in line with BoE and market expectations

** Bank of England rate cuts filter down to lower mortgage rates, boosting demand for homes

** Vistry VTYV.L top pct loser on housing index, falling about 8%; stock tops losses in blue-chip FTSE 100 .FTSE index

** Other FTSE 100 homebuilders Berkeley BKGH.L, Persimmon PSN.L, Barratt Redrow BTRW.L and Taylor Wimpey TW.L fall between 2% and 3.6%

(Reporting by Aby Jose Koilparambil in Bengaluru)

((abyjose.koilparambil@thomsonreuters.com))

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