European markets look to the U.S. Federal Reserve announcement

LONDON — European stocks are expected to open slightly higher, as markets await the outcome of the U.S. Federal Reserve’s policy meeting on Wednesday.

London’s FTSE is seen opening 13 points higher at 7,183, Germany’s DAX up 13 points at 15,745, France’s CAC 40 up 6 points at 6,648 and Italy’s FTSE MIB up 48 points at 25,756, according to IG.

Global market attention will be on the outcome of the Federal Reserve’s two-day meeting due on Wednesday.

U.S. stock index futures were little changed during overnight trading on Tuesday. U.S. stocks pulled back from record levels during Tuesday’s trading session, with the S&P 500 closing 0.2% lower after hitting an all-time high earlier in the day.

The central bank is not expected to make any policy moves, but it could signal that it’s beginning to think about easing its bond-buying policy.

The Fed will also release new forecasts on Wednesday, which could indicate a possible first rate hike penciled in for 2023. Previously, Fed officials hadn’t come to a consensus for a rate hike through 2023.

The meeting comes as inflation heats up, with producer prices rising at their fastest annual rate in nearly 11 years during May. This has prompted some, including Paul Tudor Jones, to call for the central bank to rethink its easy monetary policy.

Meanwhile, shares in Asia-Pacific were mixed in Wednesday trade as investors looked ahead to data releases in China as well as the Fed’s latest decision. China is set to announce industrial production and retail sales for May later Wednesday.

The U.K. will release inflation data for May on Wednesday, but there are no other major earnings releases expected.

– CNBC’s Pippa Stevens contributed reporting to this story.