• Economists surveyed by Reuters expect January headline inflation, including food and energy prices, to register a 1.9 percent annual gain, which actually would be a slight decline from the 2.1 percent in December. Core CPI is predicted to rise 1.7 percent compared with 1.8 percent the previous month.
However, the market is preparing for a surprise that could shake things up again.
"It would not surprise me at all if we saw inflation kick up a little and beat expectations," said Michael Arone, chief investment strategist at State Street Global Advisors. "This would further intensify the pressure on stocks and bonds and contribute to this idea of the inflation scare."
• U.S. Secretary of Defense Jim Mattis will press European allies on Wednesday to stick to a promise to increase military budgets as the United States offers an increase in its own defense spending in Europe.
For the first time, NATO countries have submitted plans to show how they will reach a target to spend 2 percent of economic output on defense every year by 2024, after Trump threatened to withdraw U.S. support for low-spending allies.
• North Korea won't give up its nukes and Americans shouldn't fall for the regime's recent charm offensive, top intelligence said Tuesday.
"North Korea continues to pose an ever-more increasing threat to the United States and its interests," Director of National Intelligence Daniel Coats told a Senate Select Committee on Intelligence's annual hearing on worldwide threats.
"Pyongyang has repeatedly stated that it does not intend to negotiate its nuclear weapons and missiles away," he added.
• Strong exports helped the German economy to continue its solid upswing at the end of last year and grow by 0.6 percent on the quarter from October through December, data showed on Wednesday.
The headline figure for seasonally adjusted gross domestic product (GDP) growth, released by the Federal Statistics Office, was in line with the consensus forecast and marked a slowdown from the downwardly revised 0.7 percent in the third quarter.
• South Korea said it will take firm action against illegal and unfair acts in cryptocurrency trading after a 280,000 signature petition was sent to the presidential Blue House.
The petition followed the justice minister saying the government may shut down cryptocurrency exchanges. It demanded that the government never impose unreasonable regulation on virtual currency trading.
• Oil prices were stable on Wednesday, supported by a statement that Saudi crude output would drop in March, healthy economic growth and on a weakening U.S. dollar.
U.S. West Texas Intermediate crude futures were at $59.19 a barrel at 0636 GMT, flat from their last settlement. WTI was trading above $65 in early February.
Brent crude futures were at $62.81 per barrel, up 9 cents from their last close. Brent was above $70 a barrel earlier this month.
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