European stocks retreated on Tuesday as Sweden's jumbo interest rate hike, aimed at tackling inflation, stoked expectations of more increases this week from the US Federal Reserve and the Bank of England. The Swedish central bank sprang the biggest rise in three decades, ramping up its rate by a full percentage point to 1.75 per cent. The news sent the region's markets into reverse as tighter global borrowing costs bear down on economic activity. Frankfurt and Paris equities also dropped about one per cent as news of rocketing German producer prices further fanned inflation fears. London fell after reopening following funeral of Queen Elizabeth II on Monday. The euro dipped against main rivals after Monday's surge, while oil price gains were capped by the stronger dollar. 'Nerves jangling again' "European stocks rallied at the open – but a jumbo rate hike from Sweden's central bank sent the nerves jangling again as investors worry about what's in store from global central banks," Markets.com analyst Neil Wilson told AFP. The US Federal Reserve is forecast on Wednesday to hike its key interest rate by another 0.75 percentage points. One day later, the Bank of England (BoE) is...