LONDON ( The Deal) -- European markets rallied for a second day after the U.K. reported that inflation slowed in July, boosting expectations that the Bank of England will keep interest rates at a record low for the time being. Asian indices also rose.
In London, the FTSE 100 rose 0.49% to 6,774.48, while in Frankfurt the DAX added 0.97% to 9,334.66. In Paris, the CAC 40 gained 0.97% to 9,334.66.
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Investors in the U.K. took heart from a report that the consumer prices index grew by 1.6% in July, cooling from 1.9% in June, amid a fall in clothing prices as well as declines in the cost of alcohol, financial services and food and non-alcoholic drinks. A separate report showed that annual house-price growth in the U.K. slowed to 10.2% in June from 10.4% in May.
On Wednesday the Bank of England is due to publish minutes from its August 6-7 monetary policy meeting, while the U.S. Federal Reserve will release minutes from late July. Both reports will come a day before central bankers gather in Jackson Hole, Wyo., to brainstorm about the economy and monetary policy.
For more on the European market rally, watch the video below:
Imperial Tobacco Group (ITYBF) gained 1.98% to 2,576 pence in London after posting a smaller-than-expected drop in nine-month sales. The company said sales fell 1% to 4.75 billion pounds.