Risk appetite subdued on Fed uncertainty, dollar steadies
By Marc Jones
LONDON (Reuters) - Uncertainty about the timing of a cut in Federal Reserve stimulus and the fine print of economic reforms in China kept global markets under pressure on Wednesday.
Emerging Asian currencies and the region's shares took fresh beating overnight in the wake of mixed signals from Fed officials about the U.S. central bank's asset-buying stimulus.
Victims including the Indian rupee and the Indonesian rupiah, looked to have stabilized in early trading in Europe, whose debt and currency markets were mostly little changed.
But the mood in the region remained jittery and some riskier assets lost ground.
London's FTSE .FTSE led European shares .FTEU3 0.5 percent lower as a drop in UK unemployment left traders eying a Bank of England inflation report at 1030 GMT for signals regarding the BoE's pledge of ultra-low rates.
Sterling popped up and the FTSE extended losses to 0.9 percent following the data.
But with a crucial hearing for Fed chair-in-waiting Janet Yellen and European third quarter growth figures both due on Thursday, the dollar .DXY and the euro as well as Europe's bond markets were by and large in a holding pattern.
"We are pausing," said National Australia Bank strategist Gavin Friend. "Any nuggets Yellen gives on her policy leaning are going to be extremely closely scrutinized. And if Q3 euro zone GDP surprises on the downside that could give the euro a kick." Continued...