London investors will focus on an interest rate decision from the Bank of England and retail-sector results in the coming days, after leaping into positive territory in the first week of 2011. The FTSE 100 index jumped 1.43 percent over the past week to finish on Friday at 5,984.33 points. The index had gained an impressive 9.2 percent in 2010.
A two-day meeting of the Bank of England (BoE) that concludes on Thursday is widely expected to see the policymakers keep its key interest rate at a record-low 0.50 percent.
"The recent strength of inflation and further rise in commodity prices will cause further discomfort" for the central bank, said Capital Economics analyst Samuel Tombs.
"Nonetheless, we still think that official interest rates will stay on hold for a long while yet." The BoE, whose main task is to keep inflation under control, is also forecast to opt against pumping more new money into the economy. The central bank has left its key lending rate at 0.50 percent since March 2009 as it seeks to aid economy recovery from a record-length recession that ended in late 2009.
Aside from monetary policy developments, investors will also digest trading updates from British retailers Marks & Spencer, Sainsbury and Tesco. The three companies will publish their latest earnings news on Tuesday, Wednesday and Thursday respectively.
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