NEW YORK (Reuters) - Global stock markets inched higher on Tuesday and the dollar dipped as investors awaited signals from the U.S. Federal Reserve on when it will hike interest rates again and start shrinking its balance sheet.
All three major U.S. stock indexes hit record closing highs, with financial shares providing the biggest boost.Tuesday marked the start of a two-day meeting of the U.S. central bank. The Fed is widely expected to keep rates steady on Wednesday but announce that it will begin paring its bond holdings, with reductions likely to start in the coming months.Investors will be watching for signals that the Fed will raise rates in December, and for any clues on personnel changes as the end of Fed Chair Janet Yellen's term approaches and after the resignation of Vice Chair Stanley Fischer earlier this month."The quiet nature of (the market) is in anticipation of the Fed meeting. Janet Yellen has a press conference, and that and the statement will perhaps provide some insight into what they're going to do in terms of deleveraging their balance sheet," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama."There's some concern among investors as to how this will work, and how it will affect long-term rates."The Fed's possible move to roll stimulus back further has not stemmed the greenback's weakness this year as other major central banks are considering steps either to slow their bond purchases or raise interest rates. As the Fed rolled out its three separate rounds of massive purchases, stocks shot up, while the dollar sank along with yields on U.S. debt.The dollar had weakened against the yen ahead of U.S. President Donald Trump's speech before the United Nations General Assembly. In his speech, Trump warned that the United States will be forced to "totally destroy" North Korea unless Pyongyang backs down from its nuclear program, but the criticism was not enough to spook investors.The greenback was just 0.1 percent lower at 111.47 yen