Anticipated ECB rate cut to drive European markets' early gains.
The European Central Bank's latest monetary policy decision is anticipated by investors in the region, leading to a predicted rally of European stocks at the open on Thursday.
According to IG's data, the U.K.'s index has opened 76 points higher at 8,267, Germany's index has increased by 159 points at 18,482, France's index has risen by 64 points at 7,460, and Italy's index has surged by 257 points at 33,472.
On Thursday, the European Central Bank (ECB) is predicted to decrease rates by 25 basis points, marking its first reduction since June and indicating a possible September cut.
The key interest rate of the ECB, which influences the pricing of various loans and mortgages across the EU, is currently at 3.75% following a series of aggressive increases.
The ECB's meeting is scheduled for days before the U.S. Federal Reserve's Sept. 17-18 meeting, where it is predicted that the Fed will commence its own rate-cutting cycle.
The latest consumer price index report from the U.S. shows a 0.2% increase in consumer prices in August, resulting in an annual inflation rate of 2.5%, which is the lowest since February 2021. European investors are also considering this information.
Although the month-over-month core CPI, excluding volatile food and energy prices, was slightly higher than anticipated, U.S. markets rose on Wednesday as investors evaluated the implications of the data for Fed policy.
Overnight, U.S. stock futures decreased slightly as investors prepared for upcoming inflation and labor data. The August producer price index will be released on Thursday, followed by jobless claims data. According to a poll by Dow Jones, economists expect the headline and core readings to increase by 0.2% last month, up from 0.1% and 0.0% in the previous month.
The number of initial jobless claims for the week ending Sept. 7 is predicted to decrease to 225,000 from 227,000 the previous week, as per Dow Jones.
There are no other major earnings or data releases in Europe on Thursday.
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