The US Federal Reserve Beige Book - a summary of conditions across Federal Reserve districts - reported ´´widespread signs´´ of a slowdown in economic activity. There was ´´modest growth´´ in five districts, while in another five districts growth was mixed or slowed but Boston and Cleveland reported firmer business activity.

The Bank of Canada has lifted its benchmark interest rate by a quarter of a percent to 1 per cent.

US President Obama has ruled out extending tax breaks for wealthier Americans.

European shares rose on Wednesday as investors shrugged off newspaper reports of fragility in the banking system. Portugal successfully raised 1.04 billion Euros on the debt market, although at higher yields. The FTSEurofirst index rose by 1.0 pct while the UK FTSE gained 0.4pct and the German Dax lifted by 0.8pct.

US sharemarkets rose in thin trade on Wednesday. Bank stocks were higher, reversing losses the previous day, with JP Morgan Chase up 2.2pct. The Dow Jones rose by 46pts or 0.5pct with the S&P 500 up 0.6pct and the Nasdaq was higher by 20pts or 0.9pct.

US treasuries fell on Wednesday (yields higher) but finished off their lows following solid demand for an auction of 10-year notes. On Thursday the remaining debt auction - $13 billion worth of 30-year notes - will be held. US 2yr yields rose by 4pts to 0.526pct and US 10yr yields rose by 6pts to 2.655pct.

The Euro and commodity currencies made modest gains against the US dollar in European and US trade on Wednesday. The Euro rose from lows near US$1.2660 to US$1.2760, ending US trade near US$1.2720. The Aussie dollar rose from US91.30c to US91.95c, ending US trade near US91.75c. But the Japanese yen eased from 83.35 yen per US dollar to JPY84.00, ending US trade near JPY83.95c.

US crude oil prices rose for the first time in three sessions on Wednesday. Commodity prices generally rose in response to a weaker greenback while the US Energy Information Administration lifted its 2010 forecast for world oil demand. The Nymex crude oil contract rose by US58c or 0.8pct to US$74.67. London Brent crude rose by US43c to US$78.17 a barrel.

Base metal prices rose on the London Metal Exchange on Wednesday, the exception being aluminium, down 0.8pct. Other metals gained between 0.6-3.3pct in response to a weaker greenback. But gold eased, with reduced demand for safe-haven assets offset against a weaker US dollar. Comex gold futures fell by US$1.80 an ounce to US$1,257.50.

Ahead: In Australia, August labour force figures are released. In the US weekly jobless claims and international trade data are released.