Those hoping that Tuesday’s UK purchasing managers’ index would provide a clear indicator as to Wednesday’s interest rate decision were disappointed. While the headline index declined, suggesting slowing activity in the manufacturing sector, inflation concerns will be heightened by the increases in both the output and input price measures.

The balance of opinion seems to be that the Bank of England will leave rates unchanged at 4.5 per cent. Cantor Index’s spread for the decision is 454-455.9, indicating that investors think there is around a 20 per cent chance of
a quarter-point increase.