Banks, mining stocks lift FTSE 100 ahead of BoE rate call this week

(Reuters) -British stocks closed higher on Tuesday, boosted by miners and bank stocks ahead of a rate decision by the Bank of England (BoE) later this week.

The blue-chip FTSE 100 gained 0.3%, continuing gains for a fifth straight day.

The banks index was up 2.2%, leading sectoral gains.

Heavyweight HSBC was among the biggest boosts to the index, up nearly 2%.

Precious metal miners firmed 1.8%, as gold hit a fresh record high above $3,000 per oz as Middle East tensions and trade uncertainties from U.S. President Donald Trump's tariff plans fueled demand for the safe-haven asset. [GOL/]

British stocks edged up alongside broader markets that plummeted earlier this month, largely due to fears that a trade war waged by Trump on multiple fronts would cause an economic slowdown in the biggest economy of the world.

The centrepiece of the week will be the Federal Reserve's policy decision on Wednesday, and any indications on future interest rate cuts to support growth will be key.

In the UK, the BoE's rate decision will be in focus on Thursday, a day after the OECD said Britain's economy will grow more slowly than previously expected in 2025 and 2026.

While both central banks are expected to stand pat on interest rates this week, traders have priced in at least two rate cuts from both the BoE and the Fed this year.

Meanwhile, Britain's Labour government announced plans to cut more than five billion pounds($6.48 billion) from its welfare budget by 2029/30, seeking to tame a sharply rising bill despite some party unrest.

The midcap FTSE 250 climbed 0.4%.

IT software services provider Bytes Technology surged nearly 18% after posting double-digit growth in full-year operating profit.

Computacenter jumped 11% to a more than six-month high, after the tech and services provider cited a strong order backlog and a 'well-placed' progress for 2025.

(Reporting by Medha Singh and Sanchayaita Roy in Bengaluru; Editing by Sonia Cheema and David Evans)