The central bank is releasing its quarterly projections for the economy, inflation, and interest rates
Wall Street stocks edged lower overnight as fresh inflation data showed a rise in producer prices to record highs. The PPI jumped 9.6% year-over-year in November versus 9.2% expected. On a monthly basis, the index rose 0.8%, also above the 0.5% expected. The Nasdaq Composite fell 1.14%, the S&P 500 slipped 0.75% and the Dow Jones fell 0.30%. Now, investor focus shifts to the Federal Reserve meeting that concludes later today.
Asian stocks were mixed-to-lower on Wednesday as market players are getting more nervous ahead of the Fed decision, with the central bank releasing quarterly projections for the economy, inflation, and interest rates. The bank is widely expected to accelerate the end of its bond-buying program. Shanghai Composite fell 0.38% even as China’s National Bureau of Statistics said that the country’s economy has continued to improve in November.
In Europe, equities opened mixed, with the overall market mood staying rather tentative ahead of crucial events as the Federal Reserve, the Bank of Japan, the Bank of England and the European Central Bank are all due to announce monetary policy decisions this week. On the data front, UK CPI rose by 5.1% on a yearly basis, up from 4.2% in October, the steepest incline for a decade.
In currencies, the dollar looks steady as the Fed’s decision looms. In recent trading, the greenback came under some selling pressure but stayed not far from one-year highs and could stage a rally across the market if the US central bank delivers a hawkish message later in the day. EURUSD bounced slightly from the 1.1250 support zone but still remains below both the 20-DMA and the 1.1300 figure during the European hours. Should the dollar jump, the common currency may retreat to fresh mid-2020 lows below 1.1200.
