European markets open lower as UK inflation jumps
European markets open lower as UK inflation jumps
European stock markets fell at the open on Wednesday after data showed a surprise jump in British inflation and investors awaited a US Federal Reserve interest rate decision.
London's benchmark FTSE 100 index fell 0.3 percent to 7,515.89 points while the Paris CAC 40 shed 0.2 percent to 7,097.16 and Frankfurt's DAX dropped 0.1 percent to 15,179.43.
UK inflation accelerated to 10.4 percent in February, above forecasts and up from 10.1 percent in January.
The data strengthened the case for another interest rate hike by the Bank of England on Thursday despite hopes among investors for a pause amid global turmoil in the banking sector.
"As inflation remains well above the BoE target, there's now a stronger case for the BoE to press ahead with a rate hike, even in a period of greater financial market uncertainty," said Richard Flax, chief investment officer at European digital wealth manager Moneyfarm.
The US Federal Reserve will announce its own interest rate decision on Wednesday, with markets eager to see if it will continue, slow or pause its rate-hike campaign following the collapse of Silicon Valley Bank and Signature Bank.
"It will be interesting to see how the BoE and the Fed consider the dynamics between fighting inflation and managing financial stability," Flax said.
