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Investors in most asset classes traded cautiously on Wednesday as they waited for a signal from the US Federal Reserve on its first rate hike and whether the euro zone would pull another Greek rabbit out of its hat.
With much of still guesswork, European markets opened with the main bourses a shade lower, the euro and dollar in tight ranges and ultra-safe German government bonds and the Swiss franc the preferred options.
Relations between Greece and its creditors have become increasingly acrimonious in recent days, leaving little hope that a meeting of EU finance ministers on Thursday will make any progress.
Meanwhile, markets are hoping that the Fed's statement due at 1800 GMT, followed half an hour later by Chair Janet Yellen's news conference, will cut the list of potential hike dates which currently stretches from September to late next year.
Whenever it comes, it will mark a major turning point for global markets, scaling back the flow of easy money from the world's top central banks that have driven both global stock and many major bond prices to record highs.
"Right now, markets are pricing a less than 30% probability the Fed hikes in September, but a greater than 60% probability they hike by December," said Richard Clarida, bond fund giant PIMCO's global strategic advisor.
"I suspect Yellen would not be unhappy if, after her press conference, the markets price in a higher probability of a September."
With investors bidding their time ahead of Yellen's comments, the dollar dipped 0.2% against the world's top currencies while the euro pushed back up to $1.1290 despite the Greek uncertainty.
Spanish, Italian and Portuguese bond yields rose again, however, having climbed to multi-month highs this week in one of the most serious episodes of euro debt contagion since the height of the debt crisis.
Their 10-year yields were 4-6 basis points higher at 2.37%, 2.35% and 3.24%, respectively.
Outside the euro zone, sterling rose to a one-month high against the dollar while gilt futures fell, after British data showed wages there grew at a faster-than-expected pace in the first quarter.
EMERGING PRESSURE
Overnight in Asia the mood had seemed a bit more positive.
MSCI's index of Asia-Pacific shares outside Japan gained 0.8%, moving away from a three-month low on Tuesday as Chinese stocks rallied by more than 2% from the day's lows.
The Shanghai market had gained 50% since the start of the year, making Chinese stocks the world's best performers in US dollar terms.
There are, however, worries about frothiness. Thomson Reuters data shows that some stock markets, such as the Shenzhen stock exchange, currently trade far above their 10-year median average.
Emerging markets are closely watching the Fed's moves. Traditionally they are highly sensitive to changes in US rates because it makes their own ones relatively less attractive for global investors and can play havoc with their currencies.
Deutsche Bank managing direction Nick Lawson said he expected MSCI's benchmark EM stock index - which is currently at a 2-1/2 month low - to break down out of a range it has been in for the last four years when US rate hikes begin.
Outflows from emerging market equity and bond funds hit their highest since 2008 according to data from fund-tracker EPFR.
In commodities, oil prices were a shade firmer as plentiful output was met by strong demand, with the market waiting for US storage figures later in the day.
US crude futures edged up 11 cents to $60.11 a barrel, while Brent added 5 cents to $63.78. Gold was sidelined at $1,179.50 an ounce and copper nudged off a three-month low.
