Barclays & Natwest Shares: Inflation & Conflict Impact
Middle East conflict sparks inflation worries, unexpectedly boosting FTSE 100 banks like Barclays, Natwest, and Standard Chartered. These banks’ shares saw gains amidst rising oil prices, the primary keyword driving market movement, with Standard Chartered exhibiting the most robust performance. The secondary keyword, rising inflation, hangs heavy as the Bank of England eyes it’s next move. The article detailed how geopolitical tensions are reshaping the financial landscape,potentially influencing monetary policy and interest rates. even experts predict a cautious approach from the Bank of England. News Directory 3 delivers the latest on global finance with insights into the potential effect on banks and investors. Discover what’s next …
FTSE 100 Banks See Shares Rise Amid Middle East inflation Fears
Updated june 16, 2025
Shares in several top FTSE 100 banks, including Barclays, Natwest and Standard Chartered, experienced gains Monday as escalating tensions in the Middle East drove up oil prices and sparked fears of increased inflation. The rising inflation could influence the Bank of England’s upcoming monetary policy decisions.
Barclays and Natwest shares both rose nearly two percent in early trading. Lloyds Banking Group also saw gains, with its shares increasing by over one percent. The surge coincided with a one percent increase in oil prices, reaching $74.90 a barrel. Oil prices previously spiked nine percent Friday following reports of Israeli strikes in Iran.
Standard Chartered led the pack,with shares jumping almost three percent.The bank had already benefited from easing trade tensions between the U.S. and China. The added pressure of rising oil prices further boosted its performance.
Richard Hunter, head of interactive investor, noted the potential impact of rising oil prices on inflation. He said the initial seven percent spike in oil could quickly affect inflation, especially with tariffs already pushing prices higher.
The Bank of England’s monetary policy committee (MPC) is scheduled to decide on interest rates june 19. Economists anticipate the MPC will likely hold rates steady at 4.25 percent,maintaining its cautious approach.
Huw Pill, the bank’s chief economist, previously suggested that rates may have been cut to rapidly, citing concerns over persistent wage growth impacting overall inflation. New anxieties stemming from the Middle East conflict could further reinforce the MPC’s decision to hold steady.
Hunter said that the Bank of England would likely acknowledge the inflationary potential of rising oil prices. However, he believes this will be secondary to signs of softening in the labor market. He added that a softer labor market could ease pressure on wage growth, potentially leaving the central bank’s monetary policy stance unchanged for the time being.
Fewer interest rate cuts would be welcomed by lenders, who reported record profits in 2024 due to high interest rates following the financial crisis.
What’s next
The Bank of England’s upcoming decision on interest rates will be closely watched for any shift in approach amid ongoing economic uncertainties and geopolitical tensions. The FTSE 100 and global markets will react accordingly.