• Global market attention will be on the outcome of the Federal Reserve's two-day meeting due on Wednesday.
• U.K. inflation exceeded expectations in May, according to official statistics published Wednesday. The Consumer Price Index rose 2.1% year-on-year and 0.6% month-on-month.

LONDON — European stocks closed slightly higher on Wednesday as markets await the outcome of the U.S. Federal Reserve's policy meeting.

The pan-European Stoxx 600 provisionally ended up 0.3%, with most sectors and major bourses in positive territory. Travel and leisure stocks led the gains, adding 1.3%, while the banking index fell 0.8%.

Global market attention will be on the outcome of the Federal Reserve's two-day meeting due on Wednesday.

U.S. stocks were mostly flat ahead of the Federal Reserve's update on monetary policy. U.S. stocks pulled back from record levels during Tuesday's trading session, with the S&P 500 closing 0.2% lower after hitting an all-time high earlier in the day.

The central bank is not expected to make any policy moves, but it could signal that it's beginning to think about easing its bond-buying policy.

The Fed will also release new forecasts on Wednesday, which could indicate a possible first rate hike penciled in for 2023. Previously, Fed officials hadn't come to a consensus for a rate hike through 2023.

The meeting comes as inflation heats up, with producer prices rising at their fastest annual rate in nearly 11 years during May. This has prompted some, including Paul Tudor Jones, to call for the central bank to rethink its easy monetary policy.

Meanwhile, shares in Asia-Pacific were mixed in Wednesday trade as investors reacted to data releases in China as well as the Fed's latest decision.

Chinese retail sales rose 12.4% in May from the same period last year, missing analyst expectations of 13.6% despite the government's efforts to boost spending.

U.K. inflation exceeded expectations in May, according to official statistics published Wednesday. The Consumer Price Index rose 2.1% year-on-year and 0.6% month-on-month, compared to expectations of 1.8% and 0.3% respectively.

"Although U.K. CPI may now further overshoot the Bank of England's 2% target, we still think it will come down again to around 2% in 2022," said Willem Sels, chief investment officer for private banking and wealth management at HSBC.

"There is significant spare capacity in labour markets, with more than two million U.K. workers remaining on furlough, meaning it is unlikely that a wage spiral develops, and hence CPI pressures should be temporary."

In terms of individual stock movement, shares of Belgian retailer Colruyt Group fell more than 11.2% after the company missed fiscal full-year earnings expectations and issuing a profit warning.

Correction: This story was updated to reflect that Colruyt Group is a Belgian company.

Enjoyed this article?
For exclusive stock picks, investment ideas and CNBC global livestream
Sign up for CNBC Pro
Start your free trial now

- CNBC's Pippa Stevens contributed reporting to this story.