The Paris Bourse is expected to trade in the red on Wednesday morning, with caution persisting against a backdrop of questions about the pace of disinflation and the monetary easing likely to follow.

At around 8:15 a.m., the future contract on the CAC 40 index - maturing in April - was trading at 8119 points, down 25.5 points, suggesting a continuation of the previous day's consolidation.

While inflation has been less of a concern of late, investors remain attentive to price developments, given that their decline has become a prerequisite for rate cuts to materialize.

Against this backdrop, market participants will be watching with interest at 11:00 am for the publication of the first consumer price figures in the eurozone for March.

Economists are expecting a stable 2.6% annualized figure for the core inflation index excluding food and energy last month, and 3.1% for its headline version, again unchanged on February.

While the Easter date - falling this year in March rather than April - could add volatility to some prices, these data are likely to cause the euro and benchmark bond yields on the Old Continent to react.

For central banks have recently made it clear that their future decisions will depend on economic indicators, and that they still need reassurance about the future of inflation in general and wage pressures in particular.

For the European Central Bank (ECB), this data is therefore of prime importance, since the Frankfurt-based institution seems reluctant to begin its rate-cutting cycle before the Federal Reserve.

The most negative scenario for equities would be if the long-awaited rate cuts did not take place, a hypothesis that could take a turn for the worse if inflation were to start rising again.

However, yesterday's surge in oil prices proves that uncertainties over inflation can still be a source of volatility, and raise doubts about the timing of rate cuts.

A new episode of tension between Israel and Iran pushed up oil prices yesterday, following strikes by Tsahal on the Iranian consulate in Damascus (Syria).

North Sea Brent is stabilizing this morning at around $89 a barrel, while US light crude (WTI) is also unchanged or close to unchanged at $85.

The market could also be tight ahead of Federal Reserve Chairman Jerome Powell's address to Stanford academics.

Traders generally expect the Fed boss to reaffirm that the conditions for a rate cut have not yet been met, given recent price disappointments, but could be within the next few months.

In the US, the ISM services index for March - expected in the afternoon - should show that activity in the tertiary sector is still expanding slightly.

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