![\"Keanu](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/03\/reeveslooking.jpeg\")
\t\tRachel Reeves is now under pressure to find a remedy as the FTSE 100 plummeted. \t<\/p>\n\t\t\tThursday 19 March 2026 2:38 pm
\n\t\t\t\t\t\u00a0|\u00a0\u00a0Updated:\u00a0<\/p>\n
\t\t\tThursday 19 March 2026 2:39 pm\n\t<\/p>\n
\t\tRachel Reeves is now under pressure to find a remedy as the FTSE 100 plummeted. \t<\/p>\n
The FTSE 100 dipped below the 10,000 mark as stocks plunged on Thursday on fears the war in the Middle East was set to bring regional energy production to a halt.\u00a0<\/p>\n
Traders sold off assets en masse over the course of the day, with the FTSE 100 falling<\/a> by some 2.5 per cent amid turmoil in energy markets and across safe havens.\u00a0<\/p>\n Its lowest trading level on Thursday was 9,997.41 points. <\/p>\n The FTSE 250, which is more UK-dominated, fell by around two per cent while the AIM index for smaller firms dropped by three per cent.\u00a0<\/p>\n Drops in stock prices came off the back of a surge in energy spot prices<\/a> as the Brent Crude oil price briefly surged above $119 per barrel while UK natural gas futures prices hit \u00a3172.33 per therm.\u00a0<\/p>\n This was more than double the price just before the US and Israel launched strikes on Iran, intensifying fears that UK inflation could shoot up over the coming months.\u00a0<\/p>\n<\/p>\n Gold prices also plunged by around 10 per cent compared to the start of the week while international markets also suffered from losses in prices, including the S&P 500 index and the Euro Stoxx 50. <\/p>\n The day of trading was punctured by the Bank of England\u2019s decision<\/a> to hold interest rates at 3.75 per cent as market analysts were unnerved by the Monetary Policy Committee\u2019s \u201chawkish\u201d guidance.\u00a0<\/p>\n The MPC said in no uncertain terms it \u201cstands ready to act as necessary\u201d to get inflation to ease to two per cent.\u00a0<\/p>\n Its new statement came as it revised up its inflation forecasts to three per cent for next month while Bank policymakers indicated they could opt to hike interest rates over fears that households and businesses were highly \u201csensitive\u201d to price shocks.\u00a0<\/p>\n \t\t\t\t\tRead more<\/p>\n \t\t\tNatwest and Lloyds shares sink as Iran tensions drag FTSE 100 into red<\/a><\/p>\n FTSE 100 fall sparks \u2018stagflation\u2019 fears<\/p>\n The fresh set of warnings are a far cry from when governor Andrew Bailey suggested falling inflation was \u201cgood news\u201d just last month, and from when Chancellor Rachel Reeves<\/a> celebrated the FTSE 100 \u201creaching record highs\u201d in January.\u00a0<\/p>\n Reeves\u2019 last public comment was a post on X saying she wanted to make the UK the \u201cbest place in the world to start, scale and grow AI companies\u201d.<\/p>\n Kathleen Brooks, research director at XTB, said \u201cconfidence is rapidly exiting the UK economy\u201d as the Bank of England was among a number of central banks \u201ccausing unprecedented volatility in the interest rate futures market\u201d.\u00a0<\/p>\n Brooks added: \u201cAt this point, they have not priced in the risks to growth. What happens to demand? The Bank does not seem to be prioritising the risks to growth, which could be very damaging down the line.\u201d<\/p>\n