<p>The inflationary spiral seems well anchored in the eurozone. The latest inflation figures released this Friday exceeded expectations, propelling the euro against the dollar but severely penalizing European stock markets.</p>
<h2 id="h-european-stock-markets-weighed-down-by-bad-inflation-figures">European stock markets weighed down by bad inflation figures&nbsp;</h2>
<p>After a favorable start to the session, the main stock exchanges of the Old Continent quickly slumped following the publication of disappointing results of <a href="https://www.cointribune.com/inflation-a-deux-chiffres-dans-la-zone-euro/" target="_blank" rel="noopener noreferrer nofollow">inflation in the eurozone</a>.</p>
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<p>The flagship EuroStoxx 600 index fell by 0,03%, erasing its initial gains of 0,08%. In Paris, the trend was similar with the <a href="https://www.cointribune.com/cac-40-le-souffle-de-linflation-fait-vaciller-la-bourse-de-paris/" target="_blank" rel="noopener noreferrer nofollow">CAC 40</a> retreating by 0,08% to 7,972.26 points, far from its day’s high of 7,982.83 points before the alarming statistic.</p>
<p>In the <a href="https://www.tradingsat.com/actualites/marches-financiers/marche-les-bourses-europeennes-baissent-l-euro-monte-apres-l-inflation-1116208.html" target="_blank" rel="noopener noreferrer nofollow">bond market</a>, yields also tightened. The German 10-year Bund jumped by 4.5 basis points to 2.7%, and its 2-year counterpart climbed by 4.1 bp to 3.121%.</p>
<h2 id="h-the-single-currency-on-conquering-ground-in-the-face-of-the-specter-of-prolonged-tightening">The single currency on conquering ground in the face of the specter of prolonged tightening&nbsp;&nbsp;</h2>
<p>Where investors were hoping for a figure of 6.9%, the eurozone consumer price index rose by 7% year-on-year in April. A figure higher than forecasted, rekindling fears of prolonged monetary tightening by the European Central Bank.</p>
<p>In the wake, the euro strengthened by 0.1% against the greenback, trading at 1.0842 dollars. Traders now anticipate that the ECB will maintain its key rates at high levels for an extended period to curb runaway inflation.</p>
<p>The relentless fight against inflation remains the absolute priority of central bankers, even at the cost of temporarily sacrificing burgeoning economic growth. With such tenacious <a href="https://www.cointribune.com/en/stock-market-controlled-inflation-wall-street-soars-cac-40-misses-the-mark/" target="_blank" rel="noopener noreferrer nofollow">inflationary</a> pressures, investors will have to arm themselves with patience before hoping for a relaxation of restrictive monetary conditions in Europe.</p>

Inflation is bleeding European stock exchanges, the euro soars nonetheless!

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