Eurozone Inflation Data to Decide ECB Rate Hike Fate

The European session is set to kick off today with the release of French and German inflation data. The French HICP Y/Y is expected at 3.2% versus 2.6% prior, while the core measure will be closely watched as it ticked lower to 1.1% in the previous month.

The ECB is currently debating whether a rate hike in October is warranted, and higher than expected underlying inflation in the Eurozone will likely prompt a rate hike at the upcoming meeting, with the market pricing a 40% chance.

In Germany, the HICP Y/Y is expected at 3.2% versus 2.9% prior, while the core measure remained unchanged at 2.4% in the previous month. The German data is generally the most important for the Eurozone CPI calculation.