By Ankika Biswas and Khushi Singh

(Reuters) -European shares were lacklustre at the start of an event-heavy week as investors buckled up for key U.S. inflation print and interest rate decisions from major global central banks, while weakness in metal prices knocked down miners.

The pan-European was flat, as of 0910 GMT, after climbing to its highest level since February 2022 on Friday.

The index advanced 11.1% so far this year, mainly boosted by bets of interest rate cuts on evidence of slowing inflation and a likely shallow recession in the euro zone economy.

The STOXX 600 has slightly underperformed its U.S. peer 's nearly 20% jump, with Wall Street benefiting from an investor rush for artificial intelligence stocks.

"We've certainly had an extraordinary sort of early Santa rally and probably the biggest fundamental driver of that has been this dramatic fall in global bond yields," said Ben Laidler, global markets strategist at investing platform eToro.

In an evaluation for the market's growing speculation of monetary policy easing globally are crucial U.S. inflation reports and interest rate decisions from the Federal Reserve, the Bank of England and European Central Bank through this week.

"The challenge for this week is if you're going to get a central bank fight back against this dramatic market repricing of early rate cuts," eToro's Laidler added.

Investors seem to be looking past the ECB's mantra that rates will stay high for some time, with arch-hawk Isabel Schnabel's sudden dovish turn and expectations of the ECB lowering its growth and inflation projections for next year also supporting such sentiment.

Miners dropped 0.8%, leading sectoral declines, as prices of most metals moved lower against a stronger dollar.

Among individual stocks, (EBR:) dropped 33.6% to the bottom of the STOXX 600 following the demerger of Syensqo from the chemical company. The latter was up 11.4% on the first day of its trading.

Encavis shed 5.1% after Morgan Stanley downgraded the German renewable energy producer to "underweight" from "equal-weight", while Lonza lost 2.7% after RBC downgraded the Swiss contract drug manufacturer to "underperform" from "outperform".

Shares of Nestle fell 0.9% after Jefferies assumed its coverage on the Swiss packaged-food giant with "underperform".

Schibsted jumped 12.2% after the Norwegian media group said it has made a non-binding agreement to sell its news media operations to Tinius Trust.

Rolls-Royce (OTC:) gained 2% after Citi upgraded its forecast on the British engineering company's earnings.