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European markets nudge higher as investors await more U.S. inflation data

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LONDON — European stocks inched higher on Monday morning as global markets await key U.S. inflation data this week and more comment from U.S. Federal Reserve Chairman Jerome Powell on interest rate hikes.

The pan-European Stoxx 600 added 0.2% in early deals, with travel and leisure stocks climbing 1.1% to lead gains as most sectors and major bourses entered positive territory.

Global markets have a busy week ahead with the latest U.S. inflation data a key data point this week. The U.S. consumer price index is set for release Wednesday and the producer price index is slated for Thursday.

Consumer prices have jumped in Europe and the U.S. over recent months. Last Friday, inflation in the euro zone hit a new record high in December coming in at 5% compared with the same month last year.

In addition, investors will be looking out for more comments on the timing of forthcoming interest rate rises from Powell, as the Fed chair is scheduled to testify Tuesday at his nomination hearing before a Senate panel.

The Fed has signaled it could dial back its easy monetary policy more aggressively than some expected. Minutes from the Fed’s December meeting released last Wednesday showed the central bank is planning to shrink its balance sheet in addition to hiking rates.

Markets will be keeping an eye on security talks betweenU.S. and Russian diplomats in Geneva on Monday that are aimed at de-escalating tensions over Ukraine.

On the data front in Europe on Monday, the euro zone releases its latest unemployment figures for November, the Netherlands’ publishes manufacturing output data for November and Italy releases its industrial sales figures for the same month.

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