LONDON, Sept 16 (Reuters) - The dollar held steady near multi-week highs on Wednesday ahead of a Federal Reserve decision that ‌traders expect will mark the first in a series of possible U.S. interest rate hikes.The dollar has advanced this week, along with yields and energy prices, gaining the most against the yen and the New Zealand dollar . The yen touched a one-week low of 155.49 per dollar during the Asian session. Market participants are betting heavily that Fed policymakers ​will lift their benchmark rate by a quarter of a percentage point, to a 3.75%-4% range, and ​signal further tightening ahead. "Even though a hike is close to being fully priced, we could ⁠see some dollar strength (if they raise interest rates)," said Kirstine Kundby-Nielsen, senior FX analyst at Danske Bank.At $1.1536, the euro ​was not far from Monday's one-month low of $1.1523. Sterling was at $1.3470 after British inflation accelerated to a five-month high in ​August, a day before the Bank of England is expected to leave rates steady.The dollar index , which measures the currency against major peers, was little changed at 99.67.Currency markets have been relatively subdued in recent weeks, while global bond yields have climbed as sovereign bonds moved in tandem leaving relative differences between ​countries' yields little changed. But the dollar gained traction in the last few sessions on expectations that even if President ​Donald Trump's Fed Chair pick, Kevin Warsh, was inclined to cut interest rates, he would first need to raise them a few ‌times to ⁠demonstrate that the Fed is committed to curbing inflation fuelled by the Iran war and the resulting surge in energy prices.Illustration shows U.S. dollar banknotesU.S. dollar banknotes are seen in this illustration taken March 24, 2026. REUTERS/Dado Ruvic/Illustration Purchase Licensing Rights, opens new tab"If you end up getting a hike and Warsh doesn't vote for it, then you could get a setback in the dollar," said Danske Bank's Kundby-Nielsen."There would be a focus on credibility."YEN TESTThe yen has been in the ​midst of its most promising ​rally in months, supported by a ⁠hawkish shift in expectations for Japanese interest rates, joint intervention by Japan and the U.S. as well as speculation that Japanese investors are repatriating capital.Traders see an 80% chance that the Bank of Japan will hike rates ​on Friday, LSEG data show, and have priced in two 25-basis-point hikes by the ​end of January."The ⁠yen's path will continue to depend heavily on interest rate differentials," David A. Meier, economist at Julius Baer, said in a research note."We recently revised our USD/JPY forecasts to 155, reflecting some scepticism that the central bank can ultimately satisfy the ⁠pace ​of tightening currently priced in by markets," he added.A long rally in ​China's yuan has lost momentum at around 6.71 to the dollar, but the currency is holding its gains despite a widening gap between low ​Chinese yields and rates elsewhere.Reporting by Samuel Indyk and Tom Westbrook; Editing by Clarence Fernandez, Christian Schmollinger and Diti Pujara

Dollar bides time ahead of expected Fed hike

Sept 16 (Reuters) - Global stocks ticked higher on Wednesday as recent rises in government bond yields ​and oil prices paused ahead of a key U.S. Federal Reserve interest-rate decision later in the day.MSCI's global equities index (.MIWD00000PUS), ‌edged 0.1% higher after falling in the previous two sessions. An index of Asia-Pacific shares outside Japan (.MISX00000PUS), climbed 0.6%, snapping a four-day losing streak. Most bourses in Europe opened higher, with the pan-European STOXX 600 (.STOXX), up 0.3%.Futures tracking the U.S. S&amp;P 500 also rose after the benchmark index (.SPX), closed lower on Tuesday for a second straight session as the yield on ​the benchmark 10-year Treasury bond hit its highest level since 2007.The yield on the U.S. 10-year Treasury note stood at 5% after easing ​earlier in the session. It rose above that threshold on Tuesday for the first time in three years, briefly touching ⁠its highest level since 2007.The Federal Reserve will announce its policy decision later on Wednesday, followed by a press conference with Chair Kevin Warsh. "It's ​a question of credibility for him to hike right now. If he doesn't hike this evening, it could be a problem for the Fed's credibility, its ​independence and for the stock market," said Michaël Nizard, head of multi-asset and overlay at Edmond de Rothschild Asset Management in Paris."It's also a question of guidance and a reaction function from the Fed. Today, it's very difficult to describe exactly what is a reaction function of the Fed."U.S. President Donald Trump has repeatedly stated a preference for ​lower interest rates, saying last month the U.S. would stop trading with countries with which it runs a trade deficit if the Fed did not cut ​rates.Traders have largely brushed aside those comments and see a rate hike as almost certain. Markets are pricing in a 92.5% probability of a 25-basis-point increase when the ‌Fed announces ⁠its decision, according to CME Group's FedWatch tool, up from 61.2% a week ago.The dollar index , which measures the U.S. currency against a basket of six others, eased 0.1% to 99.6 after nearing a two-week high.The Japanese yen held steady at 155 per dollar after weakening over the previous two sessions ahead of the Bank of Japan's policy decision on Friday, when markets expect rates to rise to their highest level in 31 years.British stocks (.FTSE), rose and the ​pound was flat after a domestic inflation ​reading did little to alter expectations ⁠ahead of the Bank of England's policy decision on Thursday, with markets largely expecting rates to remain unchanged. A rate increase is still expected by year-end."Sterling could strengthen in the coming weeks if the BoE signals hikes to ​come amid higher inflation and energy prices. The Japanese yen, meanwhile, could weaken if the BoJ's message falls ​short of hawkish market ⁠expectations," UBS Global Wealth Management analysts said in a note.Central banks worldwide are weighing tighter monetary policy as fuel-supply disruptions caused by the Middle East conflict stoke concerns about energy-driven inflation.Oil prices retreated on Wednesday, with Brent crude futures down 0.6% at $108 a barrel after rising 2.9% on Tuesday, as reports that Saudi Arabia was ⁠offering additional ​crude cargoes via Oman eased concern about the scale of supply disruptions.Digital assets continued sliding ​after a sharp selloff in the previous session, when the U.S. Senate voted against advancing comprehensive cryptocurrency legislation backed by Trump.Bitcoin dipped 0.6% to $75,423 after losing 4% on Tuesday, while ether slipped ​0.8% to $2,388 following a 6.3% drop in the previous session.Reporting by Gregor Stuart Hunter and Shashwat Chauhan. Editing by Shri Navaratnam, Amanda Cooper and Mark Potter

Stocks tick up as oil falls, bonds stabilise ahead of Fed decision

Gold price trades at $4,340/oz after retail sales rise 1.2% in August

Sept 16 (Reuters) - Gold ​prices rose over 1% on Wednesday as the dollar weakened and oil prices slipped, ‌while investors awaited the U.S. Federal Reserve's upcoming decision on interest rates for further direction.Spot gold was up 1.3% at $4,346.30 per ounce as of 1034 GMT after touching a more than one-month low on ​Monday. U.S. gold futures for December delivery rose 1.3% to $4,387.60. Oil prices eased after a ​two-day rally, while a subdued U.S. dollar made dollar-denominated metals cheaper for ⁠buyers holding other currencies. "Gold firms up today on easing dollar strength, a cooldown in ​oil prices and a pullback in U.S. bond yields," said Nikos Tzabouras, a senior market ​analyst at Jefferies-owned Tradu.com."Technically, the near-term bias remains to the downside, but bullion's trajectory will be determined by the Fed's decision."The U.S. central bank will announce its rate decision at 1800 GMT, which will ​be followed by a press conference from Fed Chair Kevin Warsh.Traders are pricing in ​a 93% chance of at least a 25-basis-point U.S. rate hike, according to the CME FedWatch Tool.Gold ‌is ⁠traditionally seen as an inflation hedge, but higher rates increase the opportunity cost of holding non-yielding bullion. "As long as supply disruptions keep crude and consumer prices elevated, pressure for monetary tightening will persist, weighing on bullion," said Tzabouras."On the other hand, ballooning deficits are eroding ​confidence in the greenback ​and fuelling the ⁠debasement trade, driving investors toward hard assets like gold."Other central banks will also announce interest rate decisions this week, with the Bank ​of Japan set to raise interest rates to a 31-year high on ​Friday and ⁠signal readiness to keep pushing up borrowing costs.On the geopolitical front, Saudi Arabia's air defences destroyed a Houthi drone south of Mecca before it entered prohibited airspace over the holy city, a ⁠spokesperson ​for the Saudi-led military coalition in Yemen said, as ​fighting spreads in the Middle East.Among other metals, spot silver rose 1.4% to $64.54 per ounce, platinum edged 0.3% higher to $1,782.74, and ​palladium gained 1.8% to $1,313.42.Reporting by Pablo Sinha in Bengaluru; Editing by Jan Harvey and Louise Heavens

Gold rises on easing dollar, oil as Fed rate verdict looms

Sept 16 (Reuters) - U.S. stock index futures attempted a recovery on Wednesday ​following a two-day slide, as lower oil prices offered some relief during a tense wait ‌for the Federal Reserve's interest rate decision.The rate move, scheduled to be announced at 2 p.m., will be crucial to investor sentiment at a time when elevated Treasury yields, inflation and the escalating Middle East conflict have kept risk appetite in check.Investors are ​also expected to focus on Fed Chair Kevin Warsh's post-decision remarks for clues on the inflation outlook and ​the likely path of rates.While traders see a nearly 93% chance of an increase, ⁠according to the CME FedWatch tool, uncertainty persists.Fed Chair Warsh was picked by U.S. President Donald Trump with the expectation ​that he would cut interest rates. If the central bank stands pat, it could throw its credibility into question, ​especially as Warsh has said he remains focused on taming price pressures, analysts say."We think market pricing for a rate hike may be overly confident," said Yung-Shin Kung, head and chief investment officer at Mast Investments.A rate increase could be a weak tool ​to address the primary factors driving inflation, such as tariffs and the AI infrastructure buildout, he added.At 6:50 ​a.m. ET, Dow E-minis were up 93 points, or 0.18%, S&amp;P 500 E-minis rose 16.5 points, or 0.22%, and Nasdaq 100 ‌E-minis advanced ⁠126.75 points, or 0.44%.The benchmark S&amp;P 500 (.SPX), had fallen 1.3% so far this month, as of Tuesday's close."Some market weakness shouldn't be surprising. Drawdowns have generally occurred during periods of uncertainty about the path of policy," wrote Brian Levitt, chief global market strategist at Invesco.Oil prices dipped after reports that Saudi Arabia was offering additional crude cargoes ​via Oman eased concerns about ​the scale of Middle ⁠East supply disruptions.Brent crude futures were down more than 1% at $107.47 and U.S. West Texas Intermediate crude futures fell 2.1% to $103.60.Energy stocks were in negative territory during premarket trading. Chevron (CVX.N), and ConocoPhillips (COP.N), ​fell 0.3% and 0.7%, respectively.Tech stocks were mixed, with Nvidia (NVDA.O), up less than 1% and ​Apple (AAPL.O), flat. ⁠Microsoft (MSFT.O), and Meta (META.O), fell marginally.A joint call by top AI executives to slow down the development of the technology has clouded the outlook for the tech sector, although there is little clarity as yet on what such a slowdown would look ⁠like.Meanwhile, ​Intel (INTC.O), was up 3.5% before the opening bell, paring some gains after ​rising more than 5% earlier. South Korea's SK Hynix (000660.KS), said no plans had been confirmed regarding reported talks with Intel for making memory chips ​in the United States.Reporting by Niket Nishant and Tharuniyaa Lakshmi in Bengaluru; Editing by Joyjeet Das and Maju Samuel

Wall Street futures edge higher in countdown to Fed decision

WASHINGTON, Sept 16 (Reuters) - The Federal Reserve is expected on Wednesday to hike interest rates for the first time since 2023, a decision driven by stubbornly high inflation and a global rise in borrowing costs that will heighten scrutiny of how U.S. central bank chief Kevin Warsh describes the first monetary policy change on ​his watch.Raising rates will fly in the face of what President Donald Trump envisioned when he named Warsh to lead the Fed earlier this year, saying he expected his appointee to lower them. The president recently threatened to impose new import ‌tariffs if the Fed does not reduce the cost of borrowing. But lifting the Fed's policy rate by a quarter of a percentage point to the 3.75%-4.00% range is a step that has become almost inevitable, with inflation seemingly stuck above the central bank's 2% target, long-term global borrowing costs shifting higher, and Warsh facing doubts about his willingness to go against Trump's demands.The pressing question now is how Warsh frames the policy decision, and whether global bond investors see it as a credible response to inflation that has been above target for more than five years and which has moved up since the start of Trump's current term in the White ​House. "If they hike and it is unanimous — that is a strong signal," particularly if accompanying economic projections show policymakers anticipate another rate hike this year and perhaps again in 2027, said Robert Sockin, chief U.S. economist at PGIM. Though Warsh ​says he wants to avoid saying too much about the rate path, Sockin, who sees three U.S. hikes in the cards, said the Fed chief's speech at the Jackson Hole economic symposium in Wyoming last month included language ⁠that would fit the moment."I look at this as a cousin to his guidance at Jackson Hole. That if inflation does not move back down with sufficient speed, we have more work to do," Sockin said. "What would be challenging is if ... he sounds ​dovish and says this is a small calibration. Markets would react poorly to that."INFLATION STUCK ABOVE 2% TARGETThe Fed is due to release its monetary policy statement at 2 p.m. EDT (1800 GMT) along with updated quarterly economic projections that will include officials' estimates of the appropriate year-end ​policy rate. The group was evenly divided in the projections released in June, with nine of 19 feeling rates would need to rise by at least a quarter of a percentage point by the end of 2026, and nine anticipating they could remain where they are or drop a quarter of a percentage point.Warsh, who dislikes the "dot plot" chart of rate projections, did not submit one of his own. Since then, support for a rate hike has been building. Three policymakers dissented in favor of a rate increase at the July 28-29 meeting, and several others have said since that they were ready to raise rates unless ​inflation showed signs of falling soon. It has not.The Personal Consumption Expenditures Price Index, the measure the Fed uses for its 2% target, increased at a 3.7% annual pace in June and July after a steady rise through much of last year. Data due on September ​30 is expected to show little if any change.Though many economists still feel inflation pressure is likely to ease eventually, oil's recent rise back above $100 a barrel, Trump's unveiling of fresh tariffs on Canada, and his threats of more import duties, and continued economic growth amid an AI ‌spending boom have ⁠raised enough risk for Fed officials to consider taking action.Warsh acknowledged as much in his recent Jackson Hole speech, saying policymakers needed to be confident "that underlying inflation is moving to our objective, clearly and at sufficient speed," while noting recent data "do not tell me that underlying trends have meaningfully improved."BOND MARKET'S PULLThe global bond market is also pulling the Fed towards higher rates. Yields on the 10-year U.S. Treasury, for example, on Tuesday climbed above 5% to a 19-year high.The across-the-board rise in rates has convinced many economists and investors of a secular trend towards higher borrowing costs independent of inflation, issuer risks or other factors that determine market-based rates. That sort of shift would mean short-term rates would need to rise just for a central bank to maintain the same monetary policy footing. As it is, many Fed ​officials, including Warsh, feel the central bank's current policy stance ​is not pressuring the economy much.Global bond market dynamics may ⁠be one reason the Trump administration could tacitly welcome a Fed hike. Upending well-baked-in rate hike expectations could intensify questions about Warsh's inflation-fighting credibility, leading to even higher long-term rates if investors anticipate rising inflation and demand more compensation for it.Yields on government bonds like the 10-year Treasury are benchmarks for consumer credit items like home mortgages, which still carry elevated financing costs despite Trump's pledge to make ​life more affordable, an issue that may figure heavily in his party's effort to keep control of Congress in the midterm elections in November.Market pricing currently puts the odds of a hike ​on Wednesday at greater than 90%. ⁠That expectation is not in itself a reason to hike, and Warsh in his Jackson Hole speech cautioned against the "hall of mirrors" that can trap officials if they start adopting the views of financial markets that are, in turn, reflecting what they hear from the Fed."There seems to have been a market echo chamber pushing up expectations despite a limited amount of incoming data," Standard Chartered analysts John Davies and Steve Englander wrote in a note, arguing the Fed should remain on hold this week. "There is a very low cost to waiting."But whether a rate hike is characterized ⁠as a one-off, ​a first step with others perhaps to follow depending on incoming data, or some other formulation, Warsh's post-meeting press conference will be as important as the policy ​decision itself."There's a ton of risk around this meeting and — especially — the press conference," Robin Brooks, a senior fellow at the Brookings Institution, wrote on Substack. With investors pricing four rate hikes between now and next June, "Warsh will be asked — over and over — where he stands on that, and I'm not sure there's a good way for him ​to respond. The big risk is that he comes off as dovish relative to what markets price, in which case we end up with a long-end (bond) selloff even though he's hiked to anchor those very same yields."Reporting by Howard Schneider; Editing by Dan Burns and Paul Simao

Warsh's words may matter more than the anticipated Fed rate hike

Sept 16 (Reuters) - The Nasdaq Composite has spent more than a month shuffling sideways, but technical analysis indicates the tech-heavy benchmark may now be preparing for a break.One of the clearest signs of a potential jolt ‌out of the weeks-old range is that the daily Bollinger bandwidth, a measure of historical volatility, is at its lowest level in more than five years. Such low readings often precede a larger move – and the start ​of a new trend. Though narrowing Bollinger bands do not necessarily indicate which direction prices ​will take, Wednesday’s interest rate decision by the Federal Reserve is one event that ⁠market participants see as a possible catalyst.Symptomatic of the Nasdaq’s narrowing range is the confluence ​of the 50- and 100-day moving averages near the 26,000 level, which has exerted a gravitational ​pull on the index.The Composite ended Tuesday at 25,981.57. Should a breakout occur, that 26,000 area is likely to become an important line of demarcation for both sellers and buyers.If the index holds above that area, bulls ​are likely to target a move above resistance near 26,725, where the trendline from the early ​June record high sits. Trendlines connect previous highs or lows and can slow or accelerate price movements. The ‌August 13 ⁠high at 26,875.52 would become the next focus, followed by the 27,190.21 June 1 record intraday peak, according to LSEG data. If, however, the Nasdaq were to fall convincingly below the support near 26,000 and also drop below a trendline extending from the March low, and the August 24 ​low at 25,910.82, bears ​might push for a ⁠return to the June 9 low at 24,980.38. Beyond that, the rising 200-day moving average near 24,507, which is near the July 29 low ​of 24,425.34, would become the next focus.What the chart shows:Nasdaq moving sideways ​since early ⁠AugustMoving averages near 26,000 keyGains target 26,725, 26,875.52 and 27,190.21; downside focus is on 24,980.38, 24,507 and 24,425.34(Mapping the Market is a daily column written by Reuters journalists. The commentary is based on a technical ⁠analysis of ​financial charts, which helps assess the likelihood of future ​price moves but does not guarantee the outcome. The column does not constitute investment advice or trading recommendations. )Terence Gabriel is ​a Reuters market analyst. The views expressed are his own. Editing by Burton Frierson and xxxx

Mapping the Market: Nasdaq may be ready to bolt

Sept 16 (Reuters) - Surging government bond yields are raising credit costs across the U.S. economy and could factor into Federal Reserve monetary policy deliberations, but analysts see the central bank resisting any explicit call from the Trump administration ​to bail out the market.The focus on the Fed's possible involvement comes as Treasury Secretary Scott Bessent has taken an unusually activist role in trying to tamp down rising yields ‌he considers to be misaligned with the U.S. economic outlook. Bessent’s campaign, which saw the expansion of a key debt buyback operation last week, is foundering, as the 10-year Treasury note rose above 5% to its highest since 2007. He shrugged the move off as owing to "global issues" on Tuesday as he arrived for a congressional hearing.Treasury’s bond market travails are raising questions whether the Fed might be requested to buy government debt to reduce supply, which could cap or lower yields, in turn easing government and private sector ​borrowing costs.Fed watchers see little prospect for that outside of markets tumbling into distress, though there's little evidence of that so far even with the steady slide in prices. That said, the question ​has persisted given comments by Fed Chairman Kevin Warsh that have signaled a greater willingness to coordinate with Treasury on some issues. “One of the Fed's unwritten mandates is ⁠financial conditions,” said Rick Rieder, BlackRock Inc's chief bond investment manager, who was under consideration by Trump to be Fed leader. Noting that Fed policymakers influence the cost of debt through their adjustments to short-term interest rates, ​he said that "has to be part of the criteria they consider" in any monetary policy decisions.The Fed on Wednesday is expected to wrap up its two-day meeting with policymakers raising their policy rate by a quarter percentage point to ​3.75% to 4.00% because recent inflation readings have been too high. Market participants believe this could help Treasury's cause because it will bolster the Fed's inflation-fighting credibility, which should help longer-dated yields come down over time.A Deutsche Bank poll of investors released Monday found that investors see a rate hike now as likely lifting yields slightly over the short term, but they see long-term yields going up even more if the Fed were to leave rates steady.If the Treasury encounters significant headwinds selling its debt or ​there were other market dislocations, the Fed could be drawn in more to buy debt to calm conditions, Rieder said. That makes it important to watch how coming debt auctions perform.Most analysts agree any harder push ​by Treasury calling on the Fed to intervene and buy bonds in large size to cap yields is a no-go for central bankers.Warsh “cares a lot about the Fed’s credibility – and about his own,” said Lou Crandall, chief economist with Wrightson ‌ICAP. The Treasury ⁠has damaged its credibility with its market interventions and the Fed leader “will have no desire to let the Fed get sucked into that. The stakes are even higher for the Fed than the Treasury.”For his part, Bessent on Tuesday called the upsized buybacks a success.Mark Sobel, a former Treasury Department official under both Republican and Democrat administrations and now U.S. chair of the OMFIF monetary policy think tank, said “the administration could conceivably push the Fed to engage in a form of quantitative easing or yield curve control, in essence seeking cheap budget funding and financial repression.” But like Crandall, Sobel believes Warsh would push back against getting involved.The case for Fed involvement goes to firepower. ​Treasury interventions are constrained to the money that it ​has on hand. The Fed, in contrast, can create ⁠money, allowing it in theory to purchase a limitless amount of bonds if required.Buying bonds in large size — called quantitative easing — is now an established part of the Fed's tool kit, first used during the 2007-2009 financial crisis and again in the COVID-19 pandemic.Economists largely agree past purchases have helped calm distressed markets, signaled the Fed’s ​commitment to stimulative monetary policy, and likely kept borrowing costs lower than they would otherwise be.During and emerging from World War II, the Fed had ​actively worked to cap borrowing ⁠costs at the Treasury's behest. But it stopped doing so following the Treasury-Fed Accord of 1951, which separated government debt management from monetary policy.Buying bonds now at Treasury’s behest would not only upend that long-standing pillar of Fed independence, it would clash with the Fed’s effort to bring inflation back down to its 2% target, which markets expect mean one or more increases in the Fed's short-term policy rate.Moreover, buying bonds in enough size to impact yields would also cause ⁠a big expansion ​in the Fed’s balance sheet, and Warsh wants Fed overall holdings, now at $6.7 trillion, to be smaller.Also arguing against Fed intervention is a ​sense among some at the central bank that higher yields exist for legitimate reasons.New York Fed President John Williams told CNBC on September 2 that rising yields are “more of a reflection of the strength of the economy” coupled with aggressive technology investment levels. He also shrugged off ​the Treasury’s interventions as a factor for Fed policy and noted what the department is doing “doesn't complicate my job or our job making monetary policy.”Reporting by Michael S. Derby; Editing by Dan Burns and Andrea Ricci

Bond market woes likely a factor for Fed, but intervention seen as unlikely

Sep 16 (Reuters) - Futures tracking Canada's main stock index rose on Wednesday as oil prices and bond yields paused after a recent surge, while investors ​braced for a widely anticipated interest-rate hike from the U.S. Federal Reserve.September futures ‌on the S&amp;P/TSX index were up 0.15% at 6:18 a.m. ET. The index fell 0.3% on Tuesday after the 10-year U.S. Treasury yield rose above 5% on ​concerns over high inflation and growing government debt load. Markets, betting that ​Fed policymakers will lift the benchmark rate by 0.25 percentage point ⁠to a 3.75% to 4% range, signal further tightening ahead. The policy decision ​is due at 2:00 p.m. ET (1800 GMT).The 10-year Treasury yield dipped to ​4.99% after surging to a multi-decade high of 5.04% on Tuesday.Oil prices fell after reports of Saudi Arabia offering additional crude cargoes via Oman eased concerns about the ​Middle East supply disruptions. Brent crude was last down 0.9% at $107.76 a ​barrel.A surge in global bond yields has weighed on equity markets in recent weeks ‌as ⁠investors fear central banks will keep monetary policy tighter for longer to tame inflationary pressures stemming from soaring energy prices.Gold prices climbed more than 1% ahead of the Fed decision.In other news, European Commission President Ursula von ​der Leyen said the ​European Union is ⁠opening the door for Canada to become its first "associate member," a status that is not set out in ​the bloc's treaties.The EU and Canada will work together ​across sectors ⁠including manufacturing, AI, critical minerals and energy, she said.Canadian Prime Minister Mark Carney's trip follows a historic breakdown in Canada-U.S. relations after trade talks collapsed ⁠last month, ​sparking a series of tit-for-tat tariff measures.FOR ​CANADIAN MARKETS NEWS, CLICK ON CODES:TSX market reportCanadian dollar and bonds report CA/Reuters global stocks poll ​for Canada ,Canadian markets directoryReporting by Darshan Kumar in Bengaluru; Editing by Shreya Biswas

TSX futures inch up ahead of US Fed decision

Sept 16 (Reuters) - Euro zone benchmark Bund yields hovered around 17-year highs on ​Wednesday as traders paused after raising bets on further European Central Bank rate increases as inflation concerns persist, ‌briefly pricing the deposit rate above 3.5% this week.Markets were also awaiting the Federal Reserve policy meeting decision later in the session, with traders widely expecting an increase of a quarter of a percentage point to a 3.75% to 4.00% range and guidance pointing to further tightening. Germany's 10-year bond yield was up one ​basis point at 3.54%, after reaching 3.5723% on Tuesday for its highest since June 2009.“Hopes are high for the ​Fed to upend the severe bond market sell-off,” said Commerzbank rate strategist Hauke Siemssen.“While the increase in ⁠oil prices was still the major driver of late, a determined Fed could calm investors' nerves, at least at the long-end.”The ​benchmark 10-year U.S. Treasury yield was slightly higher at 5.0% after reaching 5.041% on Tuesday, the highest since July 2007. NATURAL GAS PRICES ​STILL UPBrent crude oil futures retreated after a two-day rally, pressured by an unexpectedly large build in U.S. crude inventories, and gas prices were up about 2.5%. Traders see the ECB's deposit rate at 2.86% by December, up from the current 2.50%. Markets expect the rate to reach 3.38% by November 2027, ​fully pricing a third increase and pointing to a roughly 50% chance of a fourth move.The ECB raised rates last week for ​the second time this year to quell inflation that has been driven higher by rising energy prices and warned that price pressures could prove ‌lasting, fuelling bets ⁠on more tightening.Some analysts argued that expectations for rate increases had gone too far, saying higher energy prices would weigh on growth and help to dampen inflation.German two-year bond yields , more sensitive to policy rates, were up one basis point at 3.24% after reaching 3.3123% on Monday for their highest since September 2023.The ECB's updated wage tracker is pointing to a modest increase in negotiated pay growth ​in the first half of ​2027 after broadly steady increases ⁠for the rest of this year."Despite the likely acceleration in 2027 negotiated pay growth, we read this as a normalisation after a subdued 2026 rather than a new cycle," said Citi economist Giada ​Giani."Coupled with the cyclical pick-up in labour productivity growth, this should lead to further deceleration in ​unit labour costs," ⁠she added.France’s 10-year government bond yields rose 1 basis point to 4.51% after hitting 4.5531% on Tuesday for the highest level since September 2008. The yield gap versus safe-haven Bunds was at 96.50 bps after reaching 98.15 bps on Tuesday, the highest since July 2012.Concerns about ⁠the country's ​fiscal trajectory continued to weigh on its government bonds. The French government is ​due to present a budget proposal soon, a particularly delicate exercise as parties in the divided parliament harden their positions ahead of the 2027 election.Italy’s 10-year government bond ​yields rose 0.5 bps to 4.24%. The yield gap versus safe-haven Bunds was at 87 bps.reporting by Stefano Rebaudo Editing by David Goodman

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