A screen displays a press conference by U.S. Federal Reserve Chair Jerome Powell following the Fed rate announcement, on the floor of the NYSE in New York, U.S., July 30, 2025.
Jeenah Moon | Reuters
LONDON — European stocks are expected to open mostly higher as markets await the latest monetary policy decision by the U.S. Federal Reserve, which is expected to lower interest rates on Wednesday.
The U.K.’s FTSE index is expected to open 0.11% higher, Germany’s DAX up 0.25%, France’s CAC 40 up 0.22% and Italy’s FTSE MIB flat, according to data from IG.
Global markets are focused on the Fed today with the central bank widely expected to cut interest rates by 25 basis points, according to the CME’s FedWatch tool.
Policymakers will also share more insight into their outlook for rates over the next year or so in the closely-watched “dot plot” grid that accompanies their quarterly Summary of Economic Projections.
Regional investors are also reacting to the latest U.K. inflation figures, which showed that annual price growth held steady at 3.8% in August.
European markets moved lower on Tuesday as investors assessed developments in the U.S.-China trade talks that took place in Madrid earlier this week.
U.S. Treasury Secretary Scott Bessent told CNBC on Tuesday that he expected further trade discussions between Washington and Beijing to take place before punitive tariffs are set to take hold in November.
“We’ll be seeing each other again,” Bessent said. “Each one of those talks has become more and more productive. I think the Chinese now sense that a trade deal is possible.”
Tariffs rolled out by U.S. President Donald Trump in April would have seen 145% duties slapped on Chinese imports into the U.S., but these were delayed to allow for trade negotiations, with a deadline currently set for Nov. 10.
In other news, Trump’s state visit to the U.K. is in full swing on Wednesday, with the president and his wife, Melania, spending the day at Windsor Castle with King Charles and Queen Camilla before holding talks with U.K. Prime Minister Keir Starmer on Thursday.