(fxcue news) - European stocks are seen opening broadly higher on Wednesday amid inflation and rate cut optimism. After a measure of U.S. producer price inflation rose less than expected in July, investors now looked forward to the release of U.S. CPI data later in the day for further confirmation that the underlying inflation pulse in the world's largest economy is diminishing. Economists currently expect consumer prices to rise by 0.2 percent in July after edging down by 0.1 percent in June. The annual rate of consumer price growth is expected to dip to 2.9 percent from 3.0 percent. The annual rate of core price growth is expected to slow to 3.2 percent from 3.3 percent. Fed Bank of Atlanta President Raphael Bostic on Tuesday said he's looking for "a little more data" before supporting a reduction in rates. He also emphasized the importance of certainty in the Fed's decision-making process and maintained his earlier position that rate cuts might be appropriate "by the end of the year." CME Group's FedWatch Tool currently indicates a 54.5 percent chance the Fed will cut rates by 50 basis points at its monetary policy meeting next month and a 45.5 percent chance of a 25-basis point rate cut. Closer home, consumer and producer price data from the U.K. along with euro area flash GDP and industrial production figures may influence trading sentiment later in the day. Asian markets traded mixed after data showed China's bank loans to the real economy contracted for the first time in 19 years. Investors also await Chinese retail sales and industrial production figures due on Thursday for further clues to prospects for economic growth. On the geopolitical front, Vladimir Putin's "generous" offer is no longer on the table after Ukraine's invasion of Russia's Kursk region, a Kremlin official has reportedly said. Elsewhere, the Biden administration has approved a $20 billion weapons sale to Israel despite activists' opposition due to Gaza's casualties. The dollar dipped in Asian trading and gold traded below one-week high ahead of U.S. CPI data release. Oil rebounded from steep overnight losses after industry data pointed to a sizable drop in U.S. crude stockpiles. Overnight, U.S. stocks rose sharply while Treasury yields dipped as softer producer prices data signaled abating inflation pressures. Data showed producer prices, the wholesale inflation, grew 2.2 percent in July after climbing an upwardly revised 2.7 percent in June - adding to bets that the Federal Reserve will begin cutting interest rates in September. The tech-heavy Nasdaq Composite soared 2.4 percent and the S&P 500 surged 1.7 percent to score their biggest four-day rally of 2024 while the Dow gained 1 percent. European stocks recovered from an earl y slide to end higher on Tuesday following last week's volatility. The pan European STOXX 600 advanced half a percent. The German DAX rose half a percent, France's CAC 40 added 0.4 percent and the U.K.'s FTSE 100 inched up 0.3 percent.