A look at the day ahead in European and global markets from Tom Westbrook
A lurch lower in Australian inflation may be an encouraging sign for Thursday's U.S. figures, where a slowdown is also anticipated.
For both the U.S. and Australia, markets have been anticipating no further rate hikes, so the data Down Under served to reinforce expectations without driving any sudden price shifts.
Australian inflation in November eased to its lowest in nearly two years. The Australian dollar was steady as were, broadly, government bonds.
With 140 basis points of U.S. rate cuts priced for this year, there is a good deal at stake with U.S. inflation data and whether it can deliver on forecasts for a drop to its lowest since mid-2021.
Currency and bond trade in the lead-up on Wednesday was tentative and stock markets took the paths of least resistance: upwards in Japan, and downwards in Hong Kong and China.
China's blue chip CSI300 index hit a five-year low and the Hang Seng a one-month low. Japan's Nikkei, however, hit a three-decade high for a second day running.
The data calendar is rather bare for Europe on Wednesday, with the day's most anticipated event a speech at 2015 GMT by New York Fed President John Williams, an influential policymaker who has been pushing back against market pricing for so many rate cuts.
Bitcoin was steady at $46,120 after spiking on Tuesday when an unauthorised party accessed the U.S. Securities and Exchange Commission's X social media account and posted a false statement that it had approved exchanged-traded funds for bitcoin.
Taiwan goes to the polls on Saturday to elect a new president and parliament. At stake will be the future of Taiwan's fraught ties with China: Both major parties support Taiwan's sovereignty but offer different views on the island's relations with its giant neighbour.
Besides its territorial significance to Beijing, Taiwan is a global semiconductor powerhouse and home to the world's largest contract chipmaker, TSMC.
Oil prices held onto their recent gains on instability in Red Sea shipping lanes. U.S. and British forces shot down 21 drones and missiles on Tuesday that were fired by Yemen-based Houthis.
Brent crude futures rose 25 cents a barrel to $77.84.
Key developments that could influence markets on Wednesday:
- French industrial output
- Fed Williams speech
(By Tom Westbrook; Editing by Edmund Klamann)