A look at the day ahead in European and global markets from Kevin Buckland

There's no escaping that it's all about the Fed today.

And the energy around the meeting has been supercharged by the surprisingly soft inflation data that saw traders all but clear the table of any remaining rate hike bets.

Investor focus then falls on the language around the decision, with much being made of Fed officials' recent preference for the slightly more hawkish phrase "skip" instead of "pause," to reinforce the idea that the tightening cycle is not yet done.

The "hawkish hold" scenario has lost a little credence though: Looking to July, markets currently price a 39% probability for no change at that meeting too, up from only 26% odds a day earlier, according to the CME Group's FedWatch Tool.

Speculation of a less aggressive Fed is feeding appetite for risk assets. Asian stocks have followed Wall Street higher - with Japan's Nikkei punching to a fresh 33-year peak - paving the way for gains in Europe as well.

The dollar continues to sag, languishing near multi-week lows to the euro and sterling.

The British currency has the additional tailwind from continued strong wage growth in data yesterday, boosting bets for continued tightening ahead of the Bank of England's policy decision next week. Today, economists predict slightly better GDP growth in April from the previous month, but a decline in industrial output.

There's also euro-area industrial production for April, a day ahead of the ECB decision, with a quarter-point hike taken as a given, and the only point of contention whether the next one comes in July or September.

Key developments that could influence markets on Wednesday:

UK GDP, manufacturing output

Sweden CPI

Euro zone industrial production

U.S. PPI

U.S. FOMC decision

(Reporting by Kevin Buckland; Editing by Sam Holmes)