LONDON – European shares and the euro traded in tight ranges on Tuesday as investors wait to see what the European Central Bank and the U.S. Federal Reserve will do to tackle slowing global growth.

The ECB is expected to unveil details of a long awaited debt-buying scheme to tackle the region's debt crisis at its policy meeting on Thursday, where it may also cut rates as the euro area heads towards a recession.

"There are expectations that the ECB will detail bond buying plans for shorter term maturities and do something on the interest side, but more or less these aspects are priced in," said Christian Stocker, equity strategist at UniCredit.

The single currency was up 0.3 percent to US$1.2625, hovering close to a high of $1.26378 posted last Friday, its strongest level since early July.

Meanwhile, the FTSEurofirst 300 index of top European stocks was down 0.2 percent to 1,089.74 points in early trade, and the blue chip Euro STOXX 50 index had declined by 0.1 percent to 2,461.50 points.

The ECB's next step looked more certain after its President Mario Draghi told European lawmakers on Monday that the central bank's purchases of short-term sovereign bonds would not breach any European Union rules.

If the ECB meets expectations, the market's focus will likely turn to the Fed's policy-making meeting next week where it will consider whether further monetary easing is warranted.

The U.S. Institute for Supply Management's manufacturing data is due out later after similar surveys on Monday showed factory activity is slowing around the world. Friday's August U.S. non farm payrolls report will also be crucial.

Oil and gold prices were supported by the prospect of central bank stimulus with Brent crude around $116 a barrel, and the gold price at $1,696.91 an ounce.