Setting European interest rates is like plunging into a bath that is one-third scalding, one-third tepid, and one-third icy cold. The challenge for the European Central Bank is to reconcile continued German growth with Italian stagnation and a Spanish property sector that is sagging like a badly built villa. The ECB’s best bet is to put rates up once, as expected, to show inflation-fighting resolve, but the central bank is unlikely to avoid singeing at least some part of its anatomy.

A range of weak economic data was published on Monday. A survey of purchasing managers at eurozone companies, an important leading indicator, pointed to falling economic activity. The influential Ifo survey of German business conditions also came in lower. Last week’s inflation data, meanwhile, showed eurozone prices up 3.7 per cent on the previous year in May.