The financial markets remain subdued as traders await the Federal Reserve’s rate decision and updated projections later on Wednesday. The Fed is expected to cut rates by 25 basis points, but the focus will be on the revised dot plot for insights into the 2025 rate trajectory. Fed Chair Jerome Powell’s press conference at 19:30 GMT will also be closely watched.
The US Dollar Index trades near 106.80, with the 10-year Treasury yield steady below 4.4%. Major currency pairs, including EUR/USD and GBP/USD, showed limited movement on Tuesday, with the former hovering slightly above 1.0500 and the latter around 1.2700. USD/JPY retreated from a six-day rally, trading near 153.50 early Wednesday.
In other data, UK inflation aligned with expectations, showing annual CPI at 2.6% in November, but core CPI fell short of estimates at 3.5%. Gold prices remain rangebound below $2,650, reflecting cautious market sentiment ahead of the Fed’s announcement.


