New shock' for European markets as gas price spike fuels inflation fears

 Another dramatic spike in natural gas prices appears to have ended any hopes that Europe's inflation battle is set to ease, with financial markets now bracing for higher prices, a faster pace of interest rate hikes and a deeper economic downturn, Qazet.az reports.

Just a few weeks ago, signs that inflation in the United States - which tends to lead world economic shifts - might be peaking boosted stocks and lowered government borrowing costs. Investors bet central banks would now pay more attention to slowing economies, with a peak in the rate-hiking cycle nearing.

Instead, this week began with a forecast from U.S. bank Citi that UK inflation would rocket to a near half-century high of 18.6% by January, a prediction that dominated British newspaper front pages on Tuesday.

That landed as another explosive rise in natural gas prices showed little sign of slowing, with Russia signalling further squeezes on exports and European buyers scrambling for supplies before winter.