European markets are heading towards a higher open as the focus shifts to UK and U.S. inflation.

European stocks are predicted to rise on Wednesday due to anticipation of crucial inflation data from the U.S. and U.K.

According to IG's data, the U.K.'s index is predicted to open 29 points higher at 8,262, Germany's index is expected to rise 32 points to 17,837, France's index is anticipated to increase by 12 points to 7,286, and Italy's index is forecasted to open 68 points higher at 32,168.

The Bank of England cut interest rates by 25 basis points last month, and the first print of U.K. inflation data will be released on Wednesday, with economists predicting a slight increase in the headline inflation rate to 2.3% after two months at 2%.

The BoE is expected to cut interest rates by 50 basis points this year, with the central bank's key rate currently at 5%.

The U.S. consumer price index for July is expected to increase by 0.2% compared to a 0.1% decline in the previous month, while the U.K. data has already been released.

The data could prompt the U.S. Federal Reserve to cut rates in September, giving uncertain financial markets some direction after last week's volatility.

On Tuesday, the U.S. producer price index was released, indicating that wholesale prices had increased by 0.1% in the previous month. Despite this, economists had predicted a monthly gain of 0.2% in July, which was in line with the previous month's reading, according to Dow Jones consensus estimates.

On Tuesday evening, U.S. stock futures remained mostly unchanged, while Asia-Pacific markets were mixed overnight. The Reserve Bank of New Zealand reduced its benchmark lending rates, and Japan's Prime Minister Fumio Kishida announced his plans to resign in September.

UBS, RWE, Carlsberg, Aviva, Vestas Wind, TUI Group, and Thyssenkrupp are the sources of earnings in Europe. Additionally, French inflation data is also released.