Investors are increasingly betting that the European Central Bank will raise interest rates next month after Germany reported higher than expected inflation in August and Spanish price growth hit a three-month high.
The inflation data from two of the eurozone’s big-four economies has raised the prospect that price growth across the bloc will be hotter than forecast when that figure is published on Thursday.
Investors believe the price data is likely to tip the balance on the ECB’s governing council in favour of raising interest rates for a tenth consecutive time at its meeting on September 14, despite growing signs that the bloc is heading for an economic downturn.