Australian shares seen steady ahead of US Fed meeting

The news: The Australian sharemarket is likely to start barely changed with traders taking cues from Wall Street where caution prevailed ahead of the US central bank's last policy decision of the year.

The numbers: The Dow Jones index was trading 0.31% higher, the broader S&P 500 gained 0.27%, while the tech-heavy Nasdaq had added 0.47% after data showed the US Consumer Price Index (CPI) rose 3.1% in November, in line with estimates from economists. In the local market, ASX 200 futures were trading unchanged just 1 point or 0.01% higher at 7249 points at 7:00am AEDT on Wednesday.

The context: The US inflation data did little to alter expectations for the timing of a rate cut by the Federal Reserve next year. While the Fed is expected to remain on hold at its meeting on Wednesday, traders pared bets of a rate cut as soon as March next year and are now targeting May for the first rate cut. In the local market, the focus will be on the federal government’s mid-year economic and fiscal outlook statement at 10:30am AEDT.

What they said: "The market is counting on more of a soft landing that would allow the Fed to ease up," Scott Wren, senior global market strategist at the Wells Fargo Investment Institute in St. Louis told Reuters.