At its highest point since January, a key measure of inflation expectations has risen to almost 1.6%. The five-year five-year swap rate is a measure that estimates average inflation expectations in five years’ time for a period of five years. The increase in such expectations affirms that faith in the Eurozone recovery and monetary stimulus are improving.

Last week, the president of the European Central Bank, Mario Draghi, warned that the Eurozone’s higher inflation rates still depend on the ECB’s monetary stimulus packages. Further adding: “Going forward, our assessment will depend on whether we see a sustained adjustment in the path of inflation towards that objective. And that means that inflation convergence towards 2% is durable, even with a reduction in monetary accommodation. Inflation dynamics, in other words, need to be self-sustained.”

As inflation expectations continue to rise, questions of whether the ECB’s QE programme will be extended are at the forefront of investors’ minds.

Later today, Mario Draghi is set to speak at the European Parliament, where he is expected to shed some light on whether the ECB’s asset purchase programme will be extended beyond March 2017.