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As a host of major central banks hold policy meetings over the next 24 hours, the U.S. Federal Reserve hogs the spotlight but it could be the Bank of Japan that surprises markets. The Bank of England (BoE), Bank of Japan (BOJ), Norges Bank and Sweden's Riksbank announce rate decisions on Thursday, hours after the Fed's announcement on Wednesday. Pricing in Japan implies a 20% chance of a rate hike - but that higher rates are a matter of time with more than 40 bps of hikes priced in by the end of 2025.

South Korea's central bank will maintain its inflation target of 2% until the next policy review, as the era of "low-inflation" is unlikely to come in a year or two, the bank's governor said on Wednesday. "The Bank of Korea (BOK), through consultation with the government, has decided to maintain the current price stability target of 2% until the next review," Governor Rhee Chang-yong said. The central bank will continue to assess if there is any need for improvements in its inflation-targeting system, Rhee said at a press conference held after a bi-annual review of the bank's inflation-targeting monetary policy.

Federal Reserve officials on Wednesday will likely signal a slower pace of interest rate cuts next year compared with the past few months, which would mean that Americans might enjoy only slight relief from still-high borrowing costs for mortgages, auto loans and credit cards. The Fed is set to announce a quarter-point cut to its benchmark rate, from about 4.6% to roughly 4.3%. The latest move would follow a larger-than-usual half-point rate cut in September and a quarter-point reduction in November.

The U.S. dollar gained against major currencies on Tuesday following better-than-expected retail sales data that showed underlying economic momentum while markets braced for interest rate moves from the Federal Reserve and other central banks. Commerce Department data on Tuesday showed U.S. retail sales surpassed expectations by jumping 0.7% in November, backed by an uptick in motor vehicle and online purchases. Markets expect the Fed will deliver a 25-basis-point interest rate cut at the end of its two-day policy meeting on Wednesday, with futures implying a nearly 97% chance of a cut, according to the CME's FedWatch tool.

(Bloomberg) -- Federal Reserve officials are likely to lower borrowing costs for a third-straight meeting this week while also signaling fewer interest-rate cuts next year than previously projected.Most Read from BloombergHow California Sees the World, and ItselfThe US economy has proved more resilient than what officials expected just a few months ago. Recent data shows inflation is coming down more slowly than officials anticipated, and the labor market is not weakening as much as feared. That

Prices are higher, but not by a tremendous amount.

Retail sales rose 0.7% in November, the Commerce Department said Tuesday, a solid increase and higher than October's 0.5% gain. Sales jumped 2.6% at auto dealers, driving most of the gain. The boost in spending underscores that the economy is still growing at a healthy pace even with higher interest rates, a trend that could cause the Federal Reserve to lower borrowing costs more slowly next year than they have previously signaled.