The probability of an ECB rate hike has become higher

On Tuesday, inflation data in some eurozone countries were published, which increased the likelihood that the European Central Bank will continue to tighten its monetary policy. Now traders expect that the peak of the central bank's rate will be the level of 4% per annum.

In particular, inflation data from France and Spain, the region's second and fourth largest economies, were significantly higher than expected in February. 

Consumer price inflation in France increased by 0.9%, raising the annual inflation rate to 6.2%. Consumer spending data also turned out to be surprisingly strong. 

In Spain, prices rose by a more significant amount – 1.0% for the month, while analysts predicted no changes. Annual inflation accelerated to 6.1% in February from January's 5.9%. The consensus forecast suggested a slowdown to 5.5%.

European stock indexes reacted with a decline to the latest data. The Stoxx Europe 600 composite index of the largest companies in the region fell by 0.39% to 461.17. The British FTSE 100 stock index fell by 0.47% (to 7856.79), the German DAX – by 0.29% (to 15368.65 points), the French CAC 40 – by 0.33% (to 7274.59), the Italian FTSE MIB – by 0.35% (up to 26964 points).