European stock markets were mixed on Thursday as investors continued to assess the outlook for monetary policy in the US and Europe amid heightened concerns that aggressive interest rate hikes could tip the global economy into recession.
The minutes of the last meeting of the Federal Reserve released yesterday showed that central bank officials have seen “little evidence” that inflation is slowing, in a sign that the Fed is not expected to change its policy of large rate hikes to counter the price rally.
At the same time, the member of the Executive Committee of the European Central Bank, Isabel Schnabel said today that the ECB’s concerns about the path of inflation have not subsided, even noting the risk that “in the short term, inflation will increase further”.
“There are strong indications that growth will slow and I cannot rule out the possibility that we could enter a technical recession, especially if energy supplies from Russia are further disrupted,” the ECB official said.
Investors await data due later today on Eurozone harmonized inflation in July.
On the board, the pan-European Stoxx 600 lost 0.2% to 438.11 points.
Germany’s DAX gains 0.2% to 13,652.39 after plunging 2% yesterday, France’s CAC 40 slips 0.1% to 6,523.87, while Britain’s FTSE 100 loses 0.2 % at 7,500.01 units.
Regionally, Italy’s FTSE MIB gained 0.5%, while Spain’s IBEX 35 rose 0.2%.