FTSE up 0.83%; DAX up 1.37%; CAC 40 up 0.97% (Il Sole 24 Ore Radiocor) - London, 12 Jun - European shares closed as data showed that inflation in the US continued to ease.

Both the headline and the core US Consumer Price Index for May came in slower than expected.

The data comes hours before the Federal Reserve unveils its latest decision on monetary policy as its 2-day meeting wraps up.

Stubborn inflation has prompted the Fed to put back the timetable for rate cuts and prompted traders to recalculate their expectations for the number of cuts this year.

The Fed is widely expected to keep its key rates steady but most eyes will be on its so-called 'dot plot' - a chart updated on a quarterly basis giving each Fed member's prediction on the trajectory of the federal funds rate.

Fed officials have repeatedly said they will not contemplate a monetary pivot until there is hard proof that inflation is firmly under control and falling towards its 2% target.

Back in Europe, German inflation rose in May driven by higher services prices, the Federal statistics office said, confirming preliminary data. In May, consumer prices in Germany rose a monthly 0.1% and increased an annual 2.4%, according to data released by the federal statistical office Destatis that confirmed its preliminary figures. CPI rose 2.2% year on year in both April and March. The harmonized index of consumer prices, used for European Union purposes, was up a monthly 0.2% and an annual 2.8%, also in line with the preliminary figures.

Last week, the European Central Bank cut rates by 25 basis points for the first time since 2019 as widely expected by the markets, but did not commit to a particular path in the coming meetings. Despite a hike in inflation forecasts, investors still believe the ECB is likely to cut interest rates in September.

The region's stock markets dropped in the previous sessions as political uncertainty kept sentiment in check after the latest European Union elections showed a broader shift towards right-wing and far-right parties and French president Emmanuel Macron called for snap legislative elections later in June following his party lagged Marine Le Pen's far-right party in the EU vote.

The London FTSE 100 closed up 0.83% at 8,215.48 points, the Frankfurt DAX rose 1.37% at 18,625.00 points, the Paris CAC 40 gained 0.97% at 7,864.70 points, while in Milan the FTSE MIB added 1.93% at 33,874.48 points, and in Madrid the IBEX 35 closed 0.65% higher at 11,248.50 points.

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(RADIOCOR) 12-06-24 18:07:01 (0594) 5 NNNN