Asian markets drifted on Wednesday with investors biding their time ahead of a hotly anticipated Federal Reserve meeting, though Hong Kong and Shanghai were again weighed by concerns about China’s economy as leaders struggle to contain a new wave of Covid infections. A third straight day of records for Wall Street’s three main indexes and a first all-time high for 21 years in Paris — fanned by strong earnings — were unable to provide much inspiration in the face of long-running fears about surging inflation and the prospect of higher interest rates. With prices rising at rates not seen for years, central banks are being forced to row back the vast financial support put in place at the start of the pandemic, which has been credited with sending equities to records and helping the economic recovery. While some have already lifted borrowing costs or started to tighten the purse strings, the main focus is on the Fed, which is expected to say on Wednesday when it will begin tapering its own massive bond-buying programme, with particular attention on rates. “There does appear to be a growing recognition amongst a rising number of Fed officials that inflation is likely to be much more persistent than was previously envisaged,” said CMC Markets analyst Michael Hewson. “It is clear that the Fed’s narrative for acting has shifted away from the labour market, and there is a wider acknowledgement about rising inflation risk. “However, once the taper timetable has been outlined Fed officials will then come under increasing pressure to outline a timetable for an increase in interest rates, a move that Fed Chair Jay Powell has already indicated is not imminent and could be as long as a year away.” The Bank of England is seen as likely to announce a rate rise at its meeting on Thursday. Asian markets were mixed, with Sydney, Wellington, Taipei, Manila, Bangkok and Jakarta rising but Singapore, Mumbai and Seoul falling. Tokyo was closed for a holiday. Hong Kong and Shanghai slipped, with the latest Covid spike in several parts of China forcing some cities into fresh lockdowns that have led to worries about the impact on already strained supply chains in the world’s number two economy. Stresses in the country were highlighted Monday when the government urged people to stock up on daily necessities and for authorities to take steps to ensure adequate food supplies as containment measures were introduced. An outbreak in the summer has been blamed for dragging on growth in the third quarter and the closing of factories again will further flame fears about the recovery outlook.