European equity markets edged lower on Friday as investors processed recent consumer price figures from major regional economies, ahead of the U.S. Federal Reserve’s preferred inflation indicator.
At 08:10 GMT, Germany’s DAX fell 0.6%, France’s CAC 40 slipped 0.7%, and the U.K.’s FTSE 100 declined 0.4%.
Inflation in Europe and the U.S. Takes Center Stage
Earlier Friday, data showed that French consumer prices rose slightly less than expected in August, with the harmonized inflation rate registering +0.8% year-on-year, down from +0.9% in July. Spain’s EU-harmonized 12-month inflation held steady at 2.7% in August. Germany’s inflation figures are due later in the session, ahead of the eurozone’s flash August reading next Tuesday.
The European Central Bank maintained its key interest rate at 2% during the July meeting, and subsequent data has indicated that the eurozone economy remains resilient while inflation hovers near the ECB’s 2% target. Policymakers are widely expected to keep rates unchanged again in September, although July meeting minutes revealed differing views on the likely trajectory of inflation.
Later in the day, attention turns to the U.S. personal consumption expenditures (PCE) report, the Fed’s preferred inflation gauge, which could provide insight into the impact of recent U.S. tariffs on consumer prices.
Corporate Updates
In Europe, Rémy Cointreau (EU:RCO) raised the lower bound of its annual guidance after the U.S. and EU agreed to halve planned tariffs on European wines and spirits, relieving pressure on the French cognac producer. The updated trade deal, effective August 1, cut tariffs to 15% from the initially proposed 30%.
Norwegian builder Af Gruppen (TG:AF8) reported a strong jump in second-quarter profits for 2025, while Swedish property firm Sagax (TG:A2876m) acquired a 10.8% stake in Belgium-based Retail Estates (EU:RET).
Oil Prices Slip but Set for Weekly Gains
Oil futures eased slightly but remain poised for weekly gains, as traders weigh uncertainty over Russian supply alongside the approach of the U.S. summer driving season’s end.
At 04:10 ET, Brent crude fell 0.5% to $67.66 a barrel, and West Texas Intermediate (WTI) futures declined 0.5% to $64.30 a barrel. Both contracts are on track for weekly gains of just under 1%, following disruptions from Ukrainian attacks on Russian export terminals and ongoing uncertainty over peace negotiations between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelensky.
However, the approaching Labor Day holiday and the end of peak U.S. summer driving demand have pressured prices. On a monthly basis, both Brent and WTI remain down over 6%, weighed by steady production increases from OPEC members.
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