FX.co ★ European Stocks Set for Cautious Open

European equity markets were set for a muted start on Monday, as caution dominated sentiment amid expectations that major central banks will raise interest rates in the near term. Market participants increased their bets on a Federal Reserve rate hike this month following stronger-than-expected US employment data. The European Central Bank is also widely anticipated to lift its key rate this week to 2.75%, with investors additionally pricing in another increase in December. These rate expectations have been underscored by mounting inflationary pressures, as oil prices extended gains after the US and Iran exchanged strikes on ships over the weekend. Investors will also be watching a fresh estimate of Eurozone Q2 GDP and the final figures on employment changes for the quarter. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures were flat to slightly lower.