The ECB announced plans to launch a new reference point for overnight interest rates

European equities eked out modest to moderate gains after WS held up well post FOMC and as the euro weakened versus the dollar (yesterday eve). US stock markets open with tiny losses.

S&P has cut its rating on China by one notch to A+ weeks before the country is expected to launch a rare dollar bond, with the ratings agency citing rising economic and financial risks after a long period of heavy credit growth. The decision brings S&P's rating in line with those of Moody's and Fitch. No immediate impact on markets is expected.

Norway's central bank kept its key deposit rate unchanged at 0.50%, but indicated it could raise interest rates sooner than earlier anticipated after taking stock of the country's improved economic outlook and growing signs of tightening by its counterparts around the world. EUR/NOK fell to 9.32 from 9.37 before the decision.

The ECB announced plans to launch a new reference point for overnight interest rates, opening up a new alternative to the private-sector benchmarks that have been hit by scandal and are in the process of reform. Its new transaction-based overnight rate will serve as backstop to private sector benchmark rates and finalized before 2020.

The Minutes of the Polish central bank meeting showed that the majority of its members were comfortable with keeping rates stable in coming quarters. Inflationary pressures remained limited despite favourable economic conditions, good labour market conditions and gradual wage growth. There were no imbalances building. Some members suggested any rise in inflation might be met with a rate hike, fearing the effects of negative real rates.

Applications for unemployment benefits in the US unexpectedly declined last week, from 282k to 259k, as the Hurricane Harvey-related surge in Texas filings continued to reverse. The September Philly Fed Business outlook also beat forecasts, rising from 18.9 to 23.8 (vs 17.1 expected).