Federal Reserve policymakers say fresh inflation data out later this week will help them decide whether they can slow the pace of interest rate hikes at their upcoming meeting, to just a quarter point increase instead of the larger jumps they used for most of 2022.

The U.S. dollar languished near a seven-month low against other major currencies on Tuesday, as investors took heart that the Federal Reserve may be nearing the end of its rate-hike cycle and as China's reopening drove demand for riskier assets.

Consumer inflation in Japan’s capital rose more than expected in December, data showed on Tuesday, pointing to a similar increase in nationwide price pressures as the country struggles with high raw material costs and a weakened yen.

Oil prices retreated from recent gains on Tuesday in anticipation of a speech by Federal Reserve Chair Jerome Powell, while markets also sought more clarity on the restocking of the U.S. Strategic Petroleum Reserve this year. 

Britain has become less competitive and less attractive to foreign investors as a result of soaring energy costs and recent political turmoil, manufacturers said in an industry survey released on Monday.

China's foreign exchange reserves rose in December, official data showed on Saturday, as the dollar fell against other major currencies.