Driven by hopes of a forthcoming diplomatic resolution in the Middle East, markets on the Old Continent have just completed a particularly favorable sequence, marking a fourth consecutive session of gains yesterday. This performance allowed the Euro STOXX 50 to reach new all-time highs.

The CAC 40 index is now only about 2.2% away from its historical record reached on February 26, just before the start of the conflict against Iran.

However, market initiatives are expected to be more limited today pending the Fed's statement, which will be released at the end of the day.

A Delicate Debut for Kevin Warsh

At the conclusion of its two-day strategic committee (FOMC) meeting, the U.S. central bank is expected to announce at 8:00 p.m. (Paris time) that it will maintain interest rates at unchanged levels, before its new Chairman, Kevin Warsh, speaks at a press conference to be closely followed thirty minutes later.

Investors are waiting to see what tone the latter will adopt for his debut, given that he had previously promised to implement a "regime change" at the Fed.

"Kevin Warsh has expressed his desire to reduce the size of the Fed's balance sheet, but this meeting comes too early to consider a policy shift in that direction," notes Tiffany Wilding, economist at PIMCO.

"We expect him to remain cautious on this subject during his press conference, likely sufficing to emphasize the need for the Fed to gradually reduce its footprint on financial markets," she adds.

Between markets preparing for a potential rise in the cost of borrowing by the end of the year and President Trump, who conversely wishes to see rates lowered, his baptism by fire promises to be complicated to say the least.

Oil Stabilizes, Inflation Remains a Question

In addition to the Fed's announcements, investors will follow the publication of the latest Eurozone inflation figures during the morning, which could begin to reflect the "second-round effects" related to the energy surge on prices so feared by the ECB.

In the United States, retail sales are expected to show that the recent price surge is beginning to put consumer spending under pressure by leading to a decline in real wages.

In the bond market, the 10-year Treasury yield is down four basis points to 4.4280% amid doubts regarding the evolution of interest rates.

These uncertainties are also weighing on the dollar, which is stalling against the euro, with the single currency taking advantage to return near the $1.1615 threshold against the greenback.

Regarding commodities, oil prices are attempting to stabilize after four sessions of sharp declines amid easing tensions in the Middle East.

Brent is currently up 0.3% at nearly $79.2, while U.S. light crude (West Texas Intermediate, WTI) is edging up 0.3% to $76.3.