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FTSE 100 down 0.1%, FTSE 250 down 0.4%

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UK inflation unexpectedly rises in June

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Diageo ( DEO ) up after CEO steps down

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Thursday's jobs data in focus

(Updates with market closing prices)

By Ankita Yadav

July 16 (Reuters) -

UK stocks closed lower in volatile trade on Wednesday on

investors' concerns over the U.S. Federal Reserve's

independence, while investors awaited domestic employment data

later in the week.

The blue-chip FTSE 100 was down 0.1%, while the

midcap FTSE 250 index fell 0.4%.

Minutes before the UK stock market closed, a Bloomberg

report said U.S. President Donald Trump is likely to fire Fed

Chair Jerome Powell soon, pressuring Wall Street and the dollar,

and causing a spike in Treasury yields. Trump later said he was

not planning to do so.

Earlier in the day, the FTSE 100 was higher, shrugging off

data showing an unexpected rise in Britain's annual rate of

consumer price inflation to its highest in over a year at 3.6%

in June.

All eyes will be on the employment and wages figures due

on Thursday for hints on the Bank of England's next steps on

interest rates.

"The market is more focussed on the jobs market because

of recent commentary from Bank of England officials who

suggested that they're more concerned about weakness in the

labour market than in any spike in inflation, which they

consider would be temporary," said Fiona Cincotta, senior market

analyst at City Index.

The central bank is largely expected to cut interest rates

by a quarter-point in August after recent economic data fuelled

concerns of weaker domestic growth and a cooling labour market,

but the chances of such a move dimmed after Wednesday's

inflation data.

Among individual stocks, Diageo ( DEO ) added 0.5% after the

world's biggest spirits maker announced the departure of CEO

Debra Crew after two years on the job, with finance chief Nik

Jhangiani taking over in the interim.

Rio Tinto gained 1.2% after the mining giant

reported its strongest second-quarter iron ore production since

2018, a day after promoting its iron ore chief Simon Trott to

CEO.

AstraZeneca ( AZN ) edged 0.5% lower after the drugmaker's

experimental therapy, anselamimab, failed to meet the main goal

of a late-stage study for the treatment of AL amyloidosis, a

rare condition that causes a buildup of protein deposits in the

body.