Q3 profit of 2.2 billion pounds beats estimates
Bank upgrades income forecast as rate cut expectations slow
Investment bank income rises on dealmaking boost

LONDON, Oct 24 Reuters Barclays reported a forecastbeating 18 rise in thirdquarter profit on Thursday, as slower than expected interest rate cuts and upbeat investment banking prospects helped it raise its income outlook for the year.

The buoyant earnings performance shows early promise for Barclays in its challenge, along with European rivals, to sustain earnings even as interest rates fall.

Barclays said it now forecasts three Bank of England rate cuts this year to a final policy rate of 4.5, having previously forecast five cuts and a final rate of 4.

The British bank39;s pretax profit for the JulySeptember period was 2.2 billion pounds 2.85 billion, up from 1.9 billion a year ago and higher than the average of analysts39; forecasts of 2 billion pounds.

Barclays upgraded its forecast for net interest income for the year, saying it now expects to exceed 11 billion pounds rather than just hit that target.

Barclays39; shares which have rocketed 61 so far this year and are trading close to a nineyear high were 4 higher at 0825 GMT, outperforming a 0.8 rise in the FTSE 100.

Overall, these numbers are positive on any number of fronts, and the warm share price reaction to the update is wellwon given the high expectations which the bank was up against going into the results, Interactive Investor analyst Richard…