European stocks closed higher Thursday, as investors reacted to the latest policy decision by the European Central Bank as well as key U.S. inflation data.

The DAX index in Germany climbed 0.3%, the CAC 40 in France gained 0.9% and the FTSE 100 in the U.K. rose 0.8%.

ECB meeting
All eyes Thursday were on Frankfurt as the ECB concluded its latest policy-setting meeting, with policymakers keeping interest rates on hold, as widely expected, with inflation largely on target, but an uncertain growth and political outlook kept further easing open.

The ECB cut its key deposit rate to 2% in June, halving it from a record high of 4% in the space of a year, but has since decided to pause its easing cycle with inflation now only marginally above the central bank's 2% target after the surge in prices that followed the end of the COVID-19 pandemic and Russia's invasion of Ukraine.

U.S. CPI
Investors were also carefully studying the latest U.S. consumer price index data ahead of next week's Federal Reserve policy-setting meeting.

Headline U.S. consumer price growth accelerated in August, but the uptick was largely in line with estimates, potentially further bolstering wagers that the Federal Reserve will slash interest rates at its upcoming policy gathering next week.

The consumer price index came in at 2.9% in the 12 months to August, compared to 2.7% in July and matching economists' expectations, according to data from the Labor Department's Bureau of Labor Statistics. Month-on-month, the inflation gauge stood at 0.4%, faster than 0.2% in the prior month and slightly above forecasts of 0.3%.

Energean signs new deals
The corporate earnings slate is largely empty Thursday, but Energean Oil & Gas (LON:ENOG) signed more than $4 billion in new long-term gas contracts in the first half of 2025, lifting its total contracted revenues to about $20 billion over the next two decades.

Source: Investing.com