A look at the day ahead in European and global markets from

Kevin Buckland

There's little doubt in the market's mind that the Bank of

England will cut interest rates later today by another quarter

point, making it five cuts in the past year.

But a tricky balance between a slowing jobs market and

nagging inflation worries could see the board split three ways,

with two of the nine members potentially pushing for no change,

while two others may lobby for a half-point reduction.

The board's language will also be key, with a focus on

whether the message of "gradual and careful" policy easing

remains in place.

Any signs of an extended pause would be a blow for Finance

Minister Rachel Reeves and Prime Minister Keir Starmer, who have

promised to speed up Britain's slow economic growth.

Away from the UK, the market's broad focus falls squarely on

another central bank with some similar problems.

The U.S. Federal Reserve has seen the macroeconomic data

take a distinct downward turn over the past week - particularly

the labour market - just days after the board opted to forgo a

rate cut.

But with worries about simmering inflationary forces as a

result of President Donald Trump's bellicose tariff campaign

also showing up in the data, Fed Chair Jerome Powell's

wait-and-see stance also finds some support.

Hanging over the Fed's debate - which saw two Trump-chosen

Fed governors dissent in last week's decision - are the

president's persistent and aggressive calls to cut rates, often

framed with name-calling and threats to fire Powell before his

chairmanship expires in May.

The market's eyes are on Trump's short list of four possible

replacements, and more immediately, his pick to fill a governor

role abruptly vacated by Adriana Kugler.

Meanwhile, Trump's barrage of tariff threats continues

unabated, with a 100% duty on semiconductor imports and

additional levies on India for importing Russian oil among the

latest.

Trump plans to talk to Russian President Vladimir Putin next

week about ending the war in Ukraine, which is buoying the euro

while injecting uncertainty into the outlook for crude oil.

Overall though, the market has become more inured to the

constant tariff sabre-rattling and Japan's Topix index

marched to a record peak while tech-heavy Taiwan shares

leapt more than 2% to the highest in over a year.

Pan-European STOXX 50 futures are pointing 0.2%

higher, with Wall Street futures also up by about the

same amount.

A strong U.S. earnings season is one reason for that. Coming

up are Eli Lilly, ConocoPhillips and Warner Bros Discovery,

among many others.

Europe has a busy day of earnings reports as well, with

Allianz, Siemens and Merck among them.

On the data front, Germany has trade figures and industrial

production numbers, while Britain gets a reading on house

prices.

Key developments that could influence markets on Thursday:

-BoE policy decision

-UK Halifax house prices (July)

-German exports, imports, industrial production (all

June)

Trying to keep up with the latest tariff news?

Our new daily news digest offers a rundown of the top

market-moving headlines impacting global trade. Sign up for

Tariff Watch here.