Markets are stable after correcting higher on "turnaround Tuesday" but tensions are high. A weaker Yuan setting by the Chinese central bank combined with an aggressive RBNZ rate cut sent the risk sentiment into a tailspin, against the backdrop of escalating US-China trade worries.

The T-yields sell-off and negative US equity futures collaborated the latest declines in the USD/JPY pair to 105.95 lows. Meanwhile, both EUR/USD and the GBP/USD stuck to its recent trading range amid a broadly weaker US dollar and ahead of the key German Industrial Production data.

It’s a data-light European calendar for the second straight session, with the German Industrial Production data, at 06:00 GMT, to headline. German Industrial Production sunk 1.5% MoM during June, missing consensus as well.

From the UK docket, the Halifax House Prices data will drop in 07:30 GMT, which is likely to have virtually no impact on the GBP markets, as Brexit/ UK political developments and will continue to remain the main market driver.

In the NA session, the Energy Information Agency (EIA) Crude Stocks data will hog the limelight amid a lack of fresh first-tier macro releases from the US.

Among the commodities, gold entered a consolidative phase, having reached the highest levels since April 15, 2013, at $1,490.15. Both crude benchmarks faded the overnight bullish API data-led bounce and stabilized ahead of the European open.