The highlight in the eurozone will be the flash inflation estimates for November on Friday, said Daiwa Capital Markets.

As favorable energy base effects continue to fade in November, the bank expects headline inflation to increase again, by a further 0.3ppt to 2.3% year over year, which would be the highest since July.

In addition, base effects in the non-energy industrial goods and services components due to an unusually large drop in prices a year ago will also push core inflation higher, with Daiwa's expectation for an increase of 0.2ppt to 2.9% year over year being a touch above the Bloomberg consensus.

Flash consumer price index inflation estimates from Germany, Spain, Belgium and Ireland on Thursday will also provide further insight into the eurozone release.

After last week's downbeat flash PMIs, the European Commission's (EC) comprehensive economic sentiment survey on Thursday will likely also reflect heightened political uncertainties in Germany, France and the United States, pointed out the bank. Indeed, the German Ifo survey published earlier Monday saw the current business conditions index drop to the lowest since the global financial crisis outside of the initial COVID-19 slump, amid a deterioration in services sentiment and greater pessimism among construction firms, stated Daiwa.

Meanwhile, after the downside surprise in last week's EC flash consumer confidence indicator to a five-month low, the German GfK and French INSEE releases will provide further insight on Wednesday, according to the bank. In addition, the European Central Bank's monetary figures on Thursday might well report a further very modest recovery in bank lending as less restrictive monetary policy starts to feed through to lower borrowing costs.