European markets subdued ahead of Fed decision and tech earnings

European forex markets displayed a cautious tone during Wednesday's morning session as traders positioned ahead of major risk events. The euro and pound traded in tight ranges against the dollar, with EUR/USD hovering near 1.0825 and GBP/USD around 1.3150. Market participants are exercising restraint ahead of the Federal Reserve's policy decision, where the central bank is expected to maintain rates but could signal future policy direction. Additionally, major technology earnings from the 'Magnificent 7' companies are set to influence risk sentiment and potentially impact safe-haven currencies like the yen and Swiss franc. European economic data remained light, allowing traders to focus on the upcoming US events. The subdued volatility reflects typical pre-event positioning, with implied volatility measures suggesting potential breakouts once the Fed announcement and earnings reports are digested. Traders should prepare for increased volatility in major pairs following these key events.