US Dollar Rises Early Wednesday Before Release of Consumer Price Index, Energy Stocks Inventory Data

European bourses tracked higher midday Wednesday as traders weighed Ukraine-Russia peace negotiations, European counter-tariffs, and the outlook for boosted fiscal and monetary stimulus in Europe.

Bank, tech and property stocks gained, while retail issues lagged.

Spain's Intidex traded down 8% mid-session after the fashion giant posted Q4 results and soft sales.

The European Union announced retaliatory tariffs on US exports to the continent of steel and aluminum, while defense issues rose on the outlook for greater military outlays.

Investors also eyed Wall Street futures signaling green, but choppy closes overnight on Asian exchanges.

In economic news, European Central Bank (ECB) Governing Council member Mario Centeno said he would "move sooner rather than later," on interest-rate cuts, in an interview with The Wall Street Journal.

The pan-continental Stoxx Europe 600 Index was up 1% mid-session.

The Stoxx Europe 600 Technology Index was up 1.1%, and the Stoxx 600 Banks Index gained 1.7%.

The Stoxx Europe 600 Oil and Gas Index was up 0.4%, and the Stoxx 600 Europe Food and Beverage Index inclined 0.9%.

The REITE, a European REIT index, rose 1%, but the Stoxx Europe 600 Retail Index declined 2.9%.

On the national market indexes, Germany's DAX was up 1.8%, and the FTSE 100 in London was up 0.6%. The CAC 40 in Paris was up 1.3%, and Spain's IBEX 35 lost 0.62%.

Yields on benchmark 10-year German bonds were higher, near 2.93%.

Front-month North Sea Brent crude-oil futures were up 0.9% to $70.19 per barrel.

The Euro Stoxx 50 volatility index was down 4.3% to 22.35, indicating above-average volatility for European stock markets in the next 30 days, a negative signal. A reading above 20 indicates choppier markets ahead, while below 20 suggests calmer exchanges.

The BSE Sensex closed marginally down at 74,030 on Wednesday, as investors remained concerned about the impact of Donald Trump's tariff policies and possible slowdown in the US economy.

Growth-sensitive IT stocks extended their losing streak for the fourth consecutive trading session after receiving multiple downgrades from brokerage firms. Infosys dropped 4.3% after domestic brokerage firm Motilal Oswal downgraded its rating to 'Neutral,' while global brokerage Morgan Stanley cut its rating to 'Equal Weight' from 'Overweight' and reduced its target price.

Meanwhile, data released just after market hours showed India's consumer price inflation eased to 3.61% in February, below forecasts of 4%.

Traders also awaited US inflation data due later in the day, which could influence the Fed's next actions.

Bowman Seen as Front-Runner as Fed's Top Banking Cop; February CPI Report in Focus By Vicky Ge Huang

All eyes will be on the consumer-price index report as investors hope for more clarity on whether recent fears of stagflation-a toxic mix of elevated inflation and a stumbling economy-appear justified, as President Trump's import levies risk fueling price pressures while also weighing on growth.

Consumer inflation likely slowed a little in February, after January's surprising hot reading.

The report, due at 8:30 a.m. ET, will be the first monthly inflation reading that falls fully under the new Trump administration, though it won't capture the impact of the latest tariffs.

Resurgent inflation would make it harder for the Federal Reserve to make further cuts to interest rates, even if the economy is slowing.

Early Wednesday, the Trump administration's 25% tariffs on all steel and aluminum imports took effect. The European Union announced retaliatory tariffs that will start April and target a range of U.S. products including bourbon whiskey, boats and motorcycles.

Top News Bowman Seen as Front-Runner for Fed's Top Banking Cop

Advisers to President Trump have indicated to allies in recent days that Federal Reserve governor Michelle Bowman is the front-runner to serve as the central bank's top cop on banking issues , according to people familiar with the matter.

Some Republican lawmakers have urged the vice chair for bank supervision be filled promptly after growing irritated by suggestions in public and private from Chair Jerome Powell to leave the position empty.

Bank of Canada Expected to Deliver Seventh Straight Cut

Trade-policy uncertainty is expected to persuade the Bank of Canada for a seventh straight time to cut its main interest rate, as worries over economic tension between Ottawa and Washington surpass stronger-than-expected growth.

Eleven of the 12 economists surveyed by The Wall Street Journal predicted a quarter-point cut on Wednesday, bringing the Bank of Canada's target for the overnight rate down to 2.75%.

ECB Facing 'Exceptionally High' Levels of Uncertainty, Lagarde Says

The European Central Bank is confronting a new, more volatile world in which it must combine agility in responding to shocks with clarity in outlining how it is likely to react to a range of possible outcomes, President Christine Lagarde said Wednesday.

Eurozone Economy Still Burdened by High Rates, ECB's Centeno Warns BOJ Gov Reiterates That Bond Yields Should Be Determined in Market

Bank of Japan Gov. Kazuo Ueda reiterated Wednesday that bond yields should be determined freely in the market , suggesting that the central bank doesn't have any immediate plans to intervene to stop yield rises.

U.S. Economy EU Hits Back as U.S. Steel and Aluminum Tariffs Take Effect

The Trump administration imposed 25% tariffs on all steel and aluminum imports , after the U.S. and Canada backed off threats to impose additional measures Tuesday, capping a roller-coaster day on Wall Street with investors rattled by uncertainty in trade policy. The European Union announced retaliatory tariffs against the U.S. early Wednesday.

One of the Biggest Victims of Trump's Metals Tariffs: The Ford F-150 Walmart Gets an Earful From China Over Response to Trump Tariffs Ontario Could Consider Cutting Electricity to U.S. Trump's Economic Messaging Is Spooking Some of His Own Advisers

President Trump's stop-and-start trade policy and uneven economic messaging have rattled some of his own allies , triggering a flood of calls from business executives, concerns from Republican lawmakers and tension in the White House.

Watch: Trump Addresses Tariff Concerns at Business Roundtable L.A. Has Plans to Rebuild After Fires. Good Luck Getting Insurance.

The question for Los Angeles isn't so much how to rebuild the Palisades, a coastal community home to some 21,000 people, but who pays if it burns again . "Writing new policies doesn't make any sense at this time," State Farm General, California's largest property insurer, wrote Tuesday to the state insurance commissioner.

Forward Guidance Wednesday (all times ET)

8:30 a.m.: CPI

9:45 a.m.: Bank of Canada interest rate announcement

Thursday

8:30 a.m.: PPI

8:30 a.m.: Unemployment Insurance Weekly Claims Report - Initial Claims

10 a.m.: Quarterly Services

Commentary Is Trump Taking a 'Liquidationist' Approach to the Economy?

During President Trump's first term, stocks rode high on the belief that he would always pull back on policies that led to a selloff. Now, the administration is making a much tougher pitch: that even if tariffs and budget cuts cause a period of havoc, there are unexpected gains to be made on the other side.

The problem is there isn't much evidence to make investors believe that, writes Jon Sindreu for The Wall Street Journal . Indeed, such views edge close to the "liquidationist" approach historically espoused by laissez-faire economists, and most infamously associated with former President Herbert Hoover's Treasury secretary who advised him to let the economy fall.

Research Tariff Risks Facing Eurozone Could Offer Sterling Brief Respite

U.S. tariffs risks facing the eurozone could provide sterling with some temporary reprieve against the euro in the second quarter after recent falls, RBC Capital Markets analysts say in a note. President Trump is likely to push ahead with reciprocal tariffs, they say. Trump has complained about unfair VAT in the EU but appears to be overlooking U.K. VAT, they say. The main reason is that U.S. data show the U.K. runs a small goods and service deficit with the U.S. With the U.K. "out of the line of fire" from tariffs, the euro could briefly fall to 0.82 against sterling in the second quarter, they say. - Renae Dyer

Basis Points The Irish prime minister is heading to the White House Wednesday, with a crystal bowl overflowing with green shamrock- and a mission to protect his country's American-fueled economic boom from President Trump's tariff onslaught. Major Japanese companies have promised large pay increases for their workers this year, indicating that Japan's economy is making progress toward the wage-led growth policymakers want to achieve after decades of stagnation. South Korea's acting president, Choi Sang-mok, hasn't spoken with President Trump. But he desperately wants to . About Us

WSJ Pro Central Banking brings you central banking news, analysis and insights from WSJ's global team of reporters and editors. This newsletter was compiled by markets reporter Vicky Ge Huang in New York. Send your tips, suggestions and feedback to [vicky.huang@wsj.com].

This article is a text version of a Wall Street Journal newsletter published earlier today.

Global Markets Rise Ahead of U.S. Inflation Data

U.S. stock futures started the day up a touch, with signs of some stabilization across global equities indexes following further falls on Wall Street on Tuesday.

EU Hits Back as U.S. Steel and Aluminum Tariffs Take Effect

The 25% global levy was imposed by the Trump administration after the U.S. and Canada backed away from additional measures. The European Union responded with retaliatory tariffs.

Is Trump Taking a 'Liquidationist' Approach to the Economy?

The administration's view that damaging the economy now could help it later comes with little upside for investors.

Venture Investors Hoped for an IPO Recovery in 2025. Now It's On Hold.

Market volatility makes listing a 'monumental challenge.' Meanwhile, limited partners are under pressure as distributions dry up.

ECB Facing 'Exceptionally High' Levels of Uncertainty, Lagarde Says

A rise in European defense spending in response to doubts about the reliability of the U.S. as an ally could push inflation higher, but tariffs might have the opposite effect, the ECB president said.

Major Japanese Firms Promise Big Pay Raises in Bright Sign for Economy

Large companies including auto giant Toyota Motor concluded annual spring wage talks, with many saying they will fully meet unions' salary demands.

Eurozone Economy Still Burdened by High Rates, ECB's Centeno Warns

Rate setter Mario Centeno said the European Central Bank should continue to cut interest rates or risk seeing inflation settle beneath its target.

Trump's Economic Messaging Is Spooking Some of His Own Advisers

The president's team has received a flood of calls from business executives concerned about the mixed messaging on tariffs.

BOJ Reiterates That Bond Yields Should Be Determined in Market

Bank of Japan Gov. Kazuo Ueda reiterated that bond yields should be determined freely in the market, suggesting that the central bank doesn't have any immediate plans to intervene to stop yield rises.

Goldman Sachs Cuts Forecast for U.S. Economy. Trump's Tariffs Are to Blame.

Chief Economist Jan Hatzius also anticipates core PCE inflation may reaccelerate to 3% later this year.

US benchmark equity indexes were tracking in the green in Wednesday's premarket activity as traders await a key inflation report.

Standard & Poor's 500 increased 0.6%, the Dow Jones Industrial Average rose 0.4% while the Nasdaq added 0.8% before the opening bell. The majority of Asian exchanges were trending lower, while European bourses were pointing higher midday on the continent.

The consumer price index report for February is scheduled for an 8:30 am ET release. Government data are expected to show that consumer inflation rose 0.3% sequentially last month in the US, according to a Bloomberg-compiled consensus.

Also on Wednesday's economic calendar, the weekly mortgage applications bulletin posts at 7 am, followed by the weekly EIA petroleum inventories report at 10:30 am.

Shares of Intel advanced 7.9% pre-bell following media reports that Taiwan Semiconductor Manufacturing has approached major semiconductor companies, including Nvidia , Advanced Micro Devices and Broadcom , to form a joint venture that would operate the chipmaker's factories. Casey's General Stores' stock inclined 2.5% as the convenience store operator recorded fiscal third-quarter results above market estimates.

ABM Industries , VNET Group , ZIM Integrated Shipping Services and Sprinklr report their latest financial results before the bell, among others. Adobe , Crown Castle , UiPath , SentinelOne and American Eagle Outfitters release earnings after the markets close.

In premarket action, bitcoin traded down 0.8% at $82,483, West Texas Intermediate crude oil moved up 1% to $66.91 a barrel, yields on 10-year Treasuries retreated 0.4 basis points to 4.28% and gold inched lower to $2,920 an ounce.

By Chelsey Dulaney

Consumer inflation likely slowed a little in February, after January's surprising hot reading.

The report, due at 8:30 a.m. ET, will be the first monthly inflation reading that falls fully under the new Trump administration, though it won't capture the impact of the latest tariffs.

Inflation concerns have intensified, as President Trump's import levies risk fueling price pressures while also weighing on growth, a mix known as stagflation. Resurgent inflation would make it harder for the Federal Reserve to make further cuts to interest rates, even if the economy is slowing.

Early Wednesday, the Trump administration's 25% tariffs on all steel and aluminum imports took effect. The European Union announced retaliatory tariffs that will start April and target a range of U.S. products including bourbon whiskey, boats and motorcycles.

In recent trading:

• Stock futures rose. This follows a volatile session Tuesday, after Trump moved to ratchet up tariffs on Canadian aluminum and steel, then reversed course. All three major indexes fell yesterday, notching their worst two-day drop since August.
• Wall Street's fear gauge edged down. The Cboe Volatility Index, or VIX, fell about 3% to 26.
• Treasury yields were little changed early Wednesday. The benchmark 10-year yield settled above 4.28% Tuesday.
• European stocks mostly rose, despite the tariff escalation. Benchmarks rose 1% or more in France, Germany and Italy.
• The U.S. dollar strengthened slightly, after the WSJ Dollar Index settled Tuesday at the lowest level since November. The euro was little changed, at $1.09.

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