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At 02:00 ET (06:00 GMT), the DAX futures contract in Germany traded 0.3% higher, CAC 40 futures in France climbed 0.3% and the FTSE 100 futures contract in the U.K. rose 0.4%.
The ECB meets on Thursday, and investors are very uncertain of the outcome as price pressures remain elevated while data shows economic activity is now slowing sharply.
The latest illustration of the deteriorating economic outlook is expected to come from Italy later Monday, with industrial production in the eurozone’s third largest economy expected to have fallen 0.3% on the month in July, an annual drop of 1.7%.
Data released last week showed that gross domestic product in the eurozone grew just 0.1% in the second quarter compared to the previous three months, while consumer prices in Germany, the dominant economy in the eurozone, climbed annually 6.1% in August, more than three times higher than the central bank’s medium-term 2% target.
The ECB has raised rates at each of its past nine meetings and policymakers are now debating whether to raise the deposit rate again, to 4%, or pause.
The difficulty the policymakers have is if they feel further tightening is necessary then September is likely the last chance.
“If you cannot get yourself to hike in September, the case will not be stronger in October as economic data will likely worsen, and inflation in September will come lower quite a bit,” said UBS chief European economist Reinhard Cluse.
European investors will also be keeping an eye on the economic events across the pond this week, with key U.S. inflation data due in the form of the latest consumer price index on Wednesday and producer price index on Thursday.
These readings come after a string of stronger-than-expected economic numbers last week renewed worries that the U.S. Federal Reserve could raise rates more than previously expected.
The tech sector is likely to remain in the spotlight Monday after Alibaba Group (NYSE:BABA) announced outgoing chief executive Daniel Zhang will also step down as the head of its cloud unit.
The move was largely unexpected by markets, and the e-commerce giant’s stock fell sharply in Hong Kong, given that Zhang was set to lead Alibaba’s cloud unit as the company embarks on a six-way split in the coming months.
Oil prices edged lower Monday, easing from 10-month highs after a stellar rally in the wake of top producers Saudi Arabia and Russia extending their voluntary supply cuts to the end of the year.
The International Energy Agency and the Organization of the Petroleum Exporting Countries are due to release their monthly reports this week.
Investors will be looking for comments on likely demand growth given a swathe of recent data has shown that the important Chinese economy was cooling despite the lifting of anti-COVID restrictions earlier this year.
By 02:00 ET, the U.S. crude futures traded 0.5% lower at $87.06 a barrel, while the Brent contract dropped 0.2% to $90.49.
Both contracts have gained in the past two consecutive weeks with the global Brent settling at its highest since November on Friday.
Additionally, gold futures rose 0.4% to $1,950.75/oz, while EUR/USD traded 0.3% higher at 1.0730.
