Charting the Markets: Yellen Speaks While ECB Day Nears

Global stocks are little changed before Federal Reserve Chair Janet Yellen delivers a speech to The Economic Club of Washington. On Thursday she testifies before Congress' Joint Economic Committee. It's expected she'll signal a December interest rate hike is likely, while stressing the pace of increases thereafter will be gradual. U.S. data on Wednesday showed manufacturing activity unexpectedly contracted in November, throwing up questions about the durability of the world's largest economy. There's a 72 percent chance the Fed will raise rates in two weeks, according to Bloomberg data.

As U.S. two-year government bonds fall ahead of the Dec. 16 Fed meeting, the yield difference - or spread - between 10-year notes has narrowed to the least in 10 months. What is called the flattening of the yield curve signifies the path of tighter monetary policy will be a shallow one. Two-year securities are yielding their highest in over five years, rising 30 basis points since the last Fed meeting on Oct.28. Not all Fed officials are talking up the prospects of action this month. On Tuesday Chicago Fed President Charles Evans - known as a dovish Fed policymaker - admitted "to some nervousness" about the upcoming decision. He thinks it may be appropriate for the Fed funds rate to still be under 1 percent at the end of 2016.