A look at the day ahead in European and global markets from Tom Westbrook

In the dying days of zero rates in Europe, it is beginning to look like only a 75 basis-point surprise can save the euro, and never mind the pound.

The Asia session has belonged to the dollar. It's up past 144 yen and testing 7 yuan . Sterling is on the verge of breaking its pandemic low and the euro is eying a move lower into the 90s.

German industrial production figures, final euro zone growth and Bank of England Governor Andrew Bailey's appearance at parliament will be watched today, but the big focus is on the dollar and tomorrow's European Central Bank meeting.

Market pricing implies a 70% chance of a 75 bp hike, which also implies that a mere 50 bps would be a disappointment likely to weigh on a euro buckling under recession risks.

Then again, even going large might not suffice. An outsized hike in Australia was no help to the currency this week as the dollar has swept all before it.

A Reuters poll has the euro hovering where it is for a couple more months, but not collapsing, and likewise for sterling. 

In China, investment banks have been scrambling to cut their yuan forecasts as data takes a bleak turn. Disappointing trade figures on Wednesday offered the latest instalment, even if Australia offered a glimmer of hope as Q2 growth accelerated.

Asia's markets (.MIAPJ0000PUS) fell broadly, hitting a two-year low.

Key developments that could influence markets on Wednesday:

Economics: German industrial production, eurozone final GDP

Speakers: BoE's Monetary Policy Committee, including Governor Andrew Bailey, address the UK Treasury Select Committee