- Eurozone inflation stabilises at 'danger zone'
- Eurozone unemployment holds steady
- German retail sales rise
- UK consumer confidence unchanged
- Ukraine tensions continue
FTSE 100: -0.25%
CAC 40: -0.58%
FTSE MIB: -0.40%
IBEX 35: -1.42%
Stoxx 600: 0.43%
European stocks declined as Eurozone inflation stabilised and unemployment remained at near record highs ahead of the European Central Bank's (ECB) policy meeting next week.
The European Union's statistics office Eurostat estimated that consumer prices rose 0.8% year-on-year this month, the same rate as in January and December, as expected.
Lower energy prices were offset by more expensive industrial goods and services.
It remains well below the ECB's 2% target, adding to speculation the central bank will enact greater policy measures, such as stimulus and an interest rate cut.
ECB President Mario Draghi has warned of the risk of inflation getting stuck in a "danger zone" below 1%. However, yesterday he again dismissed fears of deflation.
At the last policy meeting earlier this month, Draghi said the central bank was awaiting more comprehensive figures, including economic forecasts, in March, before considering changing policy.
"We maintain our view that the ECB will cut to negative deposit rates in the second quarter," said Danske Bank Markets. "The outlook of a prolonged period of low inflation will lead to additional easing and so far ECB communication has been in favour of this instrument."
A separate report from Eurostat showed Eurozone unemployment remained at 12% in January, as predicted by analysts. The number of people without jobs edged higher to 19,175,000 from 19,158,000 in December, the statistics office said.
In Germany, retail sales climbed 0.9% year-on-year in January, compared to a 1.5% drop in December. The consensus estimate was for a 1.7% decline.
Meanwhile, in the UK, a consumer-confidence index from GfK came in at -7 this month, the same level as in January, in line with forecasts.
Later on in the session, attention will turn to US gross domestic product (GDP), which is tipped to fall slightly to 2.5% in the fourth quarter from 3.2% previously.
Other US releases include the University of Michigan's consumer confidence, pending home sales, personal consumption and Chicago's purchasing managers' index.
The data comes after Federal Reserve Chair Janet Yellen said the central bank would be closely monitoring releases to see whether the recent batch of weak reports was due to the harsh winter weather. During her testimony before Senate yesterday, she also said the Fed intended to continue to taper until sometime in the fall, although they were not on a "preset course".
Ukraine's acting president, Oleksandr Turchynov, has accused Russian forces of being directly involved in a conflict in the eastern European nation's Crimea region.
Ukraine's parliament has called on the United Nations Security Council to discuss the situation in Crimea while Prime Minister Arseniy Yatsenyuk warned of the growing threat of partition and economic collapse.
The nation's central bank has also put a 15,000 hryvnia limit on daily bank withdrawals in hard currency.
A peace deal with the European Union had been brokered to end weeks of deadly violence but it fell through over the weekend, leading to the ousting of Russian-backed President Viktor Yanukovych.
Erste Group, Serco
Erste Group Bank declined as it set aside provisions for bad loans and its outlook disappointed investors.
Serco Group was higher after naming Aggreko's Chief Executive Officer (CEO) Rupert Soamesnew as its new CEO with effect from June.
Old Mutual increased after buying Intrinsic Financial Services for an undisclosed amount.
Belgacom slumped as the Belgian telephone company posted fourth quarter earnings that fell short of market expectations.
The euro gained 0.58% to $1.3790.
Brent crude futures fell $0.295 to $108.640 per barrel, according to data from the ICE.