Eurostat said CPI rose 3.3% YoY in August, up from 2.9% in July and the
strongest reading since September 2023. The acceleration, attributed in part to
the war involving Iran and to stronger-than-expected eurozone economic activity,
reinforces the case for ECB tightening; markets fully price a 25 bps hike on
Sept. 10 and expect further increases. A September hike would cement the ECB’s
standing as the most hawkish G7 central bank.