London's FTSE 100 closed 0.07% in the green on Friday amid the release of the Bank of England's Decision Maker Panel survey.
The survey, conducted May 8 to 22, received 2,086 responses from chief financial officers of small, medium and large businesses in the UK. Results showed that firms expect the year-ahead consumer price index in the country to increase 3.7% in the three months to May.
Berenberg said the survey boosted confidence that higher energy prices will not trigger a price-wage spiral despite soft demand and a weak labor market. "We stand by our forecast that the BoE will not raise interest rates as investors expect, but instead resume cuts by year end," Berenberg added.
Meanwhile, average house prices in the UK dipped 0.1% month over month in May, in line with the decline in the previous month, according to data from Halifax. Year over year, average house prices in the UK rose 0.5% in May, compared with the 0.4% gain in April.
In corporate news, France's National Financial Prosecutor's Office filed charges of organized money laundering and conspiracy to commit offenses such as embezzlement of public funds, breach of trust, or bribery of a public official against HSBC's (HSBA.L) Swiss unit. The charges relate to suspicions that HSBC Private Bank Suisse helped Lebanon's former central bank chief to embezzle more than $300 million between 2002 and 2015.
The banking group toldit cannot comment on a legal matter and will continue to cooperate with the ongoing investigation. At closing, its stock declined 0.45%.
On the geopolitical front, Iran said it fired warning missiles and drones toward US warships in the Gulf of Oman after accusing Washington of interfering with maritime traffic and seizing oil tankers, while US-Iran diplomatic efforts showed little sign of progress. Oman said operations at its Mina al Fahal oil export terminal were continuing normally despite earlier reports of disruptions.