EU : Market gauge of long-term euro zone inflation hits 5-1/2-month high

LONDON : A market gauge of long-term euro zone inflation expectations hit its highest level since late May on Thursday, pulled up by expectations of rising consumer prices in the U.S. under a Donald Trump presidency.

Euro zone bond yields hit multi-month highs, rising in the slipstream of the biggest surge in U.S. yields seen in years as investors bet Trump’s protectionist trade policies and fiscal spending would boost inflation.

A key market measure of long-term inflation in the U.S. – the five-year, five-year forward – rose to 2.38 percent on Wednesday, its highest since July 2015.

The euro zone equivalent – which is followed closely by the European Central Bank – hit a 5-1/2-month high of 1.4890 percent.