Eurozone inflation rises to 3.3% as markets price ECB hike

LATEST: Eurozone inflation rose from 2.9% to 3.3% in August, reaching its highest level in nearly three years and marking the sixth consecutive month above the ECB's 2% target.
Elevated energy prices linked to the Iran conflict have added upward pressure to headline inflation. Core inflation, however, eased to 2.4%, while services inflation fell to 3.0%.
Markets are now fully pricing a 25 basis-point ECB rate hike on September 10, which would take the policy rate from 2.25% to 2.50%.
The divergence between rising headline inflation and softer underlying measures leaves the ECB facing a difficult trade-off between inflation control and economic growth.