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Global stocks eked out small gains and the dollar slipped on Wednesday on hopes that central banks will stop raising interest rates in early 2023 following the latest U.S. data that showed a slowdown in inflation.

Yet nervousness about the next moves by policymakers kept gains in check ahead of a Federal Reserve meeting later on Wednesday and central bank decisions in Europe and Britain on Thursday.

The subdued price moves followed a rally in stocks and a sharp drop in the dollar the previous session when the consumer prices data was released.

The U.S. consumer price index increased 0.1% last month, 0.2 percentage points slower than economists expected. In the 12 months through November, headline CPI climbed 7.1% - its slowest pace in about a year.

Data on Wednesday showed British inflation also moderated more than anticipated in November.

The MSCI All World stock index edged 0.07% higher, with European shares slipping, but Asian markets rising overnight. It had jumped more than 1% the previous day.

In currency markets, the dollar fell for the second straight day. It was last down 0.49% against Japan's yen to 134.92. The euro was up 0.21% against the greenback at $1.065.

The dollar, a safe-haven asset which has been boosted by U.S. rate hikes this year, has dropped around 9% from a two-decade high in September in the hope that the central banks would soon stop raising interest rates.

The dollar index was 0.24% lower at 103.83 after hitting a six-month low of 103.57 the previous day.

Susannah Streeter, senior markets analyst at Hargreaves Lansdown, said investors were in a "wait-and-see mood" ahead of the Fed rate decision.

"There was that pop we saw in markets, but then there's a realisation perhaps dawning that it's not necessarily going to be an easy path ahead... it's a long way down," she said of U.S. inflation.

European stocks fell, with the continent-wide Stoxx 600 down 0.59% after rising 1.3% in the previous session.

Futures for the U.S. S&P 500 stock index, meanwhile, were down 0.11%. That followed a 0.7% rise in the index on Tuesday.

In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.94%, with easing Chinese COVID-19 curbs boosting sentiment.

The yield on benchmark 10-year U.S. Treasuries was little changed at 3.501% after tumbling 11 basis points (bps) on Tuesday. Yields move inversely to prices.

"It's hard to see where more good news is going to come from on the inflation front," said Jonas Goltermann, senior global markets economist at Capital Economics. "The question for next year is are we going to get all the way back down to 2%."

FED AHEAD

Markets expect the Fed will slow the pace of hikes when it announces its decision at 1900 GMT and raise its funds rate target range by 50 bps to between 4.25% and 4.5%.

Much of the focus will be on the "dot plot" chart that will show the projection about future rate movements by committee members and the tone chairman Jerome Powell strikes in his press conference.

The median projection in September was for a peak in the Fed funds rate of around 4.6% next year, but some analysts think the Fed could go higher.

"The market wants to know if the Fed will change their stance on the dot plot," said Tareck Horchani, head of dealing, Prime Brokerage, at Maybank Securities in Singapore.

Oil prices rallied for the second straight session, with Brent futures rising 1.2% to $81.64 a barrel and U.S. crude gaining 1.35% to $76.42 a barrel.

Bitcoin got a bounce on Tuesday despite the arrest of FTX exchange founder Sam Bankman-Fried, who was accused by U.S. prosecutors of fraud. It was last up 0.25% to $17,816.