LONDON — European markets closed higher on Friday, the last trading day of August, as investors considered inflation data from around the world.

The pan-European Stoxx 600 notched an intraday record high of 526.66 points during the session, according to LSEG data, before paring gains slightly. The index nonetheless closed above 525 points for the first time, having shaken off the sharp sell-off at the start of August to end the month around 1.3% higher.

U.S. stocks were also higher Friday after several days of choppy trading action on Wall Street this week, with the S&P 500 and Dow Jones Industrial Average both heading for a fourth straight winning month.

The tech-heavy Nasdaq Composite has lagged and traded flat amid what analysts have identified as a sectoral rotation into small caps over the summer.

Global equity markets have been buoyed by increased optimism of a soft landing for the U.S. economy and expectations for the start of interest rate cuts from the Federal Reserve in September, with follow-up cuts from the European Central Bank and others.

A series of key inflation data was published in both Europe and the U.S. this week reinforcing those expectations.

Euro zone inflation fell to a three-year low of 2.2% in August, according to flash figures released by statistics agency Eurostat on Friday. The reading was in line with expectations, and below July’s 2.6% print.

Elsewhere, France’s preliminary, EU-harmonized consumer price index came in at 2.2% for August on an annual basis, down from the 2.7% print of July, the country’s statistics office said Friday. Preliminary data from Italy’s statistics agency showed the harmonized CPI came in at 1.3% on an annual basis in August, less than in the previous month.

That comes after German and Spanish CPI reports released Thursday showed that inflationary pressures in the two countries are easing.

Stateside, data showed that the Federal Reserve’s favored inflation measure, the personal consumption expenditures price index increased 0.2% in July on a monthly basis, which was in line with expectations. The data could inform the central bank’s monetary policy, with many investors hoping that the Fed will start cutting interest rates when it next meets in September.

“We’re fairly bullish from a medium-term perspective,” Dennis Jose, head of global equity strategy at BNP Paribas Exane, told CNBC’s “Squawk Box Europe” on Thursday.

“We’ve been in the soft landing camp for nearly two years… I think the market has caught up with that view. But I think heading into Q3 the key theme we were looking for was for markets to embrace the view that inflation is dead. That would allow rates to come down, that would lock in central bank cutting cycles, and that would effectively bring the Fed put back,” Jose said.

“Meanwhile, growth has been soggy. So the key debate for Q4 is whether the sogginess does lead to a recession, or whether we get something else.”