Volkswacht Bodensee - Stock markets in holding pattern before Fed announcement lands

In New York, the Dow, the S&P 500 and Nasdaq were all 0.1 percent or less either side of Tuesday's closing levels as investors avoided bets ahead of the Fed's announcements later Wednesday.

London and Frankfurt were also little changed, but Paris slumped after a profit warning from a flagship luxury goods company.

The Fed is expected to leave its interest rates unchanged and "that makes Fed Chair Jerome Powell's post-FOMC press conference a must-see, must-listen occasion as investors seek clues to the central bank's mindset on inflation and the path of interest rates," said Charles Schwab analyst Joe Mazzola.

Traders will be closely watching the "dot plot" of projections for how many cuts they see this year.

In December, the Fed was projecting a total of three cuts this year but there are worries policymakers could harden their outlook to just two and maybe even delay the first cut because of stickier-than-anticipated inflation in recent reports.

The continued health of the US jobs market is also lifting pressure off the Fed to ease its monetary stance.

That continued health could support US stocks even if the Fed's language is deemed hawkish, said Chris Beauchamp, market analyst at IG.

"The keys to further gains are higher earnings and a solid economy, and both those things are still in place in the US," he said.

Paris' luxury-heavy CAC 40 index fell 0.5 percent after French giant and Gucci-owner Kering issued a profit warning over weak Chinese demand.

"This is causing concern that other luxury houses could see a similar downturn in demand from this important market," said Kathleen Brooks, an analyst at XTB.com.

Kering shares closed down 12 percent in Paris, its worst single-day decline ever.

Burberry shed more than three percent in London. LVMH fell 1.4 percent in Paris and Hermes was little changed.

London stocks were largely flat even though UK inflation fell more than expected, fuelling speculation that the Bank of England could start cutting its key rate in June rather than later in the year.

In the eurozone, European Central Bank President Christine Lagarde warned of the risk of acting "too late" on interest rate cuts, reaffirming the likelihood that the first reduction in the bloc's borrowing costs would come in June.

"We cannot wait until we have all the relevant information," Lagarde said at a conference in Frankfurt.

But she also declined to pre-commit to an interest rate path once that first cut has been made.

The yen continued its slide after the Bank of Japan marginally raised rates but indicated it wouldn't do so again in the near term.

- Key figures around 1640 GMT -

New York - Dow: FLAT at 39,108.26 points

New York - S&P 500: DOWN less than 0.1 percent at 5,175.34

New York - Nasdaq Composite: DOWN 0.1 percent at 16,152.39

London - FTSE 100: FLAT at 7,737.38 (close)

Paris - CAC 40: DOWN 0.5 percent at 8,161.41 (close)

Frankfurt - DAX: UP 0.2 percent at 18,015.13 (close)

EURO STOXX 50: DOWN 0.2 percent at 5,000.31 (close)

Hong Kong - Hang Seng Index: UP 0.1 percent at 16,543.07 (close)

Shanghai - Composite: UP 0.6 percent at 3,079.69 (close)

Tokyo - Nikkei 225: Closed for holiday

Dollar/yen: UP at 151.59 yen from 150.88 yen on Tuesday

Euro/dollar: DOWN at $1.0858 from $1.0867

Pound/dollar: DOWN at $1.2712 from $1.2721

Euro/pound: UNCHANGED at 85.40 pence

West Texas Intermediate: DOWN 2.2 percent at $81.67 per barrel

Brent North Sea Crude: DOWN 1.6 percent at $85.95 per barrel

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D.Schaer--VB