FX.co ★ European Shares Seen Tad Lower As Fed Meeting Gets Underway

European stocks are expected to open rather unenthusiastically this Tuesday as the U.S. Federal Reserve commences a crucial two-day policy meeting. This will be the first updating of Federal Reserve economic and rate projections since December, led by Fed Chair Jerome Powell.

Meanwhile, the Bank of Japan has increased its prime interest rate for the first time in 17 years following a comprehensive review of the positive correlation between wages and prices. On the other hand, the Reserve Bank of Australia has decided to maintain a steady interest rate and has relinquished its slightly aggressive posture.

The People's Bank of China is set to meet on Wednesday, and central bank discussions in Switzerland and Norway are scheduled for Thursday. Asian markets showed a mixed performance, with stocks in Seoul, mainland China, and Hong Kong declining. This comes after accusations were levelled against Evergrande and its founder, Hui Ka Yan, by China's foremost securities regulator, charging them with a $78 billion fraud leading up to the property firm's downfall.

As the financial world anticipates potential alterations to the renowned "dot plot" of the U.S. central bank, the dollar has seen a momentary rise toward the 150-yen mark. Meanwhile, following a nearly 2% surge on Monday due to indicators of a future supply constraint, oil prices have experienced a slight downturn. Gold, however, has remained stable after its previous session's increase.

Awaited later today are the results of Germany's ZEW economic confidence survey, with predictions showing an increase in the economic confidence index from 19.9 in February to 20.6 in March. Updated inflation figures from the U.K. are also expected on Wednesday, with an anticipated annual rise of 3.6% year-on-year. Market observers also look forward to PMIs, the Bank of England's decision on Thursday, and the retail sales figures on Friday.

The report on new residential construction in New York may draw some attention later today, ahead of the Fed announcement. U.S. stocks went up overnight despite the Treasury yields reaching a three-week apex amid uncertainties revolving around Federal Reserve easing. The Nasdaq Composite improved by 0.8% following a resurgence in AI interest. The S&P 500 also broke its three-day losing spell, gaining 0.6%, and the Dow registered a slight increase of 0.2%.

European stocks concluded last Monday on a muted note as investors braced for a week full of central bank decisions. The pan-European STOXX 600 marginally decreased by 0.2%. Both the German DAX and the U.K.'s FTSE 100 ended with negligible losses, while France's CAC 40 experienced a minor decline of 0.2%.