Investors await the Fed’s final interest rate decision for the year, expected later Wednesday stateside, with expectations that the central bank will keep the rate on hold.

“We expect the (Federal Open Market Committee) to leave the Funds rate unchanged,” Joseph Capurso, senior currency strategist at Commonwealth Bank of Australia, wrote in a note.

“The FOMC is confident that current policy settings are at an appropriate level to lift US inflation back towards target,” Capurso said. “We doubt there has been any material reassessment of this view since the October meeting.”

Meanwhile, developments on U.S.-China trade will be watched as Sunday inches closer, when more tariffs on Chinese exports to the U.S. are set to kick in. That comes as markets have been expecting a “phase one” trade deal to be reached between Washington and Beijing.

The Wall Street Journal reported Tuesday that the U.S. plans to delay slapping China with additional tariffs as both sides try to work out the agreement.

U.S. negotiators have also asked Chinese officials to commit to some agricultural purchases upfront before moving forward with a deal, the report added. Meanwhile, China wants its agricultural purchases to be proportional with the amount of tariffs the U.S. rolls back. The U.S. is also reportedly pushing for a quarterly review of the promised purchases.

Still, White House economic advisor Larry Kudlow said Tuesday following the Journal report that the Dec. 15 tariffs are still “on the table.”

“We think a lot of the good news … is reflected in the price,” Eric Robertson, global head of foreign exchange, rates and credit research at Standard Chartered Bank, told CNBC’s “Squawk Box” on Wednesday. “In other words, markets now assume or anticipate that some form of a phase one deal will be signed.”

“Even if it doesn’t happen by the 15th, I think what you might see is something along the lines of: ‘We’re still negotiating, we’re in the final stretch, we’re waiting to put pen to paper, tariffs will go into place on the 15th but we won’t collect any revenue on them for the next six months,'” Robertson said.

Stocks on Wall Street dipped overnight, with the Dow Jones Industrial Average closing 27.88 points lower at 27,881.72. The S&P 500 shed 0.1% to end at 3,132.52 while the Nasdaq Composite dipped 0.1% as well to close at 8,616.18.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 97.511 after seeing earlier highs above 97.6.

The Japanese yen traded at 108.71 per dollar after weakening from levels below 108.6 yesterday. The Australian dollar was at $0.6811 after touching levels around $0.683 in the previous session.

Oil prices declined in the morning of Asian trading hours as international benchmark Brent crude futures slipped 0.62% to $63.94 per barrel. U.S. crude futures also shed 0.52% to $58.93 per barrel.

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