Eurozone Inflation Surges to Near Three-Year High

The European Central Bank is expected to raise interest rates next week as inflation in the Eurozone hit a near three-year high of 3.3% year-over-year in August.

The rise in consumer prices exceeded market expectations and surpassed the ECB's 2% target, leading to a surge in market expectations for further monetary policy tightening.

The London FTSE 100 Index fell by 34.98 points, or 0.32%, to close at 10,789.28, while the Frankfurt DAX Index dropped by 288 points, or 1.10%, to settle at 25,970.11.

Rising inflation expectations were reflected in the bond market, with German 10-year government bond yields reaching their highest level since April 2011.