Morning Bid: Fed bets cool, BOJ wagers heat up

In Sydney, Reserve Bank of Australia Assistant Governor Christopher Kent warned of the risk of further policy tightening at a Reuters NEXT Newsmaker event, saying inflation threats remain on the upside and "a lot of things" would need to go right to avert another rate hike.

Key developments that could influence markets on Thursday:

• Euro zone, UK June industrial production
• U.S. weekly jobless claims

Asian stocks were mostly firm in the morning session, with South Korean shares hitting their highest levels in three weeks on chip stocks.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up nearly 1%, while Japan's Nikkei .N225 rose 1.61% as of the midday recess.

In early European trades, the pan-region Euro Stoxx 50 futures STXEc1 rose 0.49%, German DAX futures FDXc1 were up 0.3% and FTSE futures FFIc1 edged 0.24% higher.

Oil prices fell after forecasters scaled back this year's global demand outlook, citing the broader fallout from the Middle East war.

United States and Iran remained deadlocked over efforts to end the conflict, with conflicting claims about control over the vital Strait of Hormuz.

U.S. crude CLc1 shed 1.3% to $82.19 a barrel and Brent LCOc1 eased to $87.95 per barrel, down 1.16%.

For all the anticipation, Wednesday's U.S. CPI data was largely in line with expectations, perhaps even a little anticlimactic.