Sharecast - The FTSE 100 was up 0.2% at 7,789.05.
Russ Mould, investment director at AJ Bell, said: "The Fed is widely expected to deliver what could be its final rate hike in this cycle of 25 basis points so barring any big shock on that score, the focus will fall on the comments which accompany the decision.
"Confirmation that rates will be put on hold after today, while largely anticipated in the market, could nonetheless give sentiment a bit of a boost. The reverse, on the other hand, could really knock confidence.
"The continuing sell-off in US regional banks highlights to the Fed the risks of stretching the financial system to breaking point if it remains in hawkish mode.
"All the while the threat of a debt ceiling crisis in Washington looms over everything. There have been panics like this before and everything has ultimately been resolved at the eleventh hour. Some sort of fudge remains the most likely outcome.
"Still, a highly partisan political backdrop across the Atlantic means the risk of the US defaulting on its debts is possibly as high as it’s ever been."
In equity markets, education publisher Pearson (LON:PSON) rose, having tumbled on Tuesday after US peer Chegg warned over the impact of AI on its homework-help services.
Coca-Cola (NYSE:KO) HBC fizzed higher as it reported first-quarter organic revenue growth of 22.2%, excluding Russia and Ukraine, led by price mix and offset by declines in stills due to an anticipated weakness in water.
TI Fluid Systems surged to the top of the FTSE 250 after it reported a 15.2% jump in first-quarter revenues and said it was outperforming markets in all regions.
On the downside, Lloyds (LON:LLOY) slumped as it became the latest UK lender to beat quarterly profit forecasts as earnings surged on the back of higher interest rates, but said that deposits fell sharply. The bank posted first-quarter pre-tax profit of £2.26bn, up 46% and better than the £1.95bn average of analyst forecasts. Net income, generated after deposit payouts, rose 15% to £4.7bn.
Customer deposits fell by £2.2bn to £473.1bn, including a reduction in retail current account balances of £3.5bn, partly driven by seasonal customer outflows, including tax payments, higher spend and a more competitive market, Lloyds said.
Haleon lost ground as the consumer health company said first-quarter profits came in below expectations as higher costs hit earnings margins.
RS Group (LON:RS1R) was weaker as it said that chief financial officer David Egan was leaving the business with immediate effect after admitting a relationship with a colleague that fell "short of the high standards expected" of the company.
Barratt Developments (LON:BDEV) fell despite hinting at a recovery in the housing market and saying that sales rates have picked up after a difficult end to 2022.
Mould said: "A muted share price reaction on its latest update should be seen in the context of strong gains last month on a read-across from other housebuilders’ cautious optimism and a recent positive shift in UK property prices."
Aston Martin (LON:AML) was down despite posting a narrowing of its first-quarter losses, with strong growth in deliveries of its sport utility vehicle DBX, and backing its full-year guidance.
Watches of Switzerland was also in the red as it announced the departure of chief financial officer Bill Floydd by mutual agreement.