The United Kingdom’s markets received a surprising improvement on Tuesday, along with the FTSE 100 closing the day’s event at a month’s high of 5589.16 following government information that disclosed the UK inflation has significantly decreased to 2.8 per cent this May this year drawing ever closer towards the government’s 2 per cent goal.
This data fervently fuelled many assumptions of yet another QE proclamation by the Bank of England as early as the succeeding month. The decline in the UK’s inflation goes in some ways into lessening the demands of the Bank of England and opening the door of opportunity for the Bank of England to insert another round of QE to jolt the long and stale halt of Britain’s economy.
The effect of diminishing inflation on the markets
Tuesday’s CPI result of 2.8 per cent came from a decrease to 3 per cent in April and has been attributed in part by the diminishing fuel, food prices and energy as well as with the effect of the VAT increase in the previous year. The FTSE 100 has taken a good vantage point from this positive data while temporarily disregarding the constraints and afflictions of the Eurozone debt crisis and imposing higher charges up to 1.7 per cent on the day. Tuesday’s inflation figures provide potential spread betting financiers an option from this unexpected rise on the FTSE 100, making it possible to gain profit despite the index rise becoming higher or lower as many speculate in the coming days.
Taking sides with spread betting
With the use of spread betting techniques investors can make profit not just the moment when the markets are on the high but more importantly when prices are decreasing as well. This ultimately results in investors believing that the present upswing in the FTSE 100 is cut short and that the markets will cascade down lower in the coming days on the fixed premise that the Eurozone crisis is still in the account, investors and traders can take short positions on the FTSE 100 respectively. If the chances are in your favour and the FTSE moves in the direction you have anticipated then you will most likely earn a profit or else if luck doesn’t favour you will deficit much of your investments.