European Stocks Largely Lower; Concerns Mount Over Eurozone CPI Release
31 May 2022
FTSE 100 is trading up 0.13% at 7591.50
European stock markets traded in a cautious manner Tuesday, ahead of the release of key Eurozone inflation data which could heighten concerns about the pace and scale of looming interest rate hikes.
By 3:45 AM ET (0745 GMT), the DAX in Germany traded 0.7% lower, the CAC 40 in France fell 0.9%, while the U.K.’s FTSE 100 outperformed, climbing 0.2%.
French inflation rose more than expected in May, with data released earlier Tuesday showing consumer prices rose 0.7% in May for a new record 12-month inflation rate of 5.8%, up from 5.4% in April.
Economic numbers released on Monday showed German inflation hit another all-time high while numbers from Spain also topped estimates.
This puts the focus on the latest Eurozone inflation flash estimate, at 5 AM ET (0900 GMT), with economists expecting the consumer price index to hit another record high of 7.7% in May, up from 7.4% in April.
This data arrives just over a week before a crucial European Central Bank meeting where officials are set to announce the conclusion of large-scale asset purchases and confirm plans to raise interest rates in July for the first time in more than a decade.
ECB President Christine Lagarde indicated last week that the central bank’s deposit rate should start rising in July, and a hefty rise in Eurozone CPI could strengthen the case for an outsized interest rate hike.
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