A look at the day ahead in European and global markets from Vidya Ranganathan

The third quarter of 2022 draws to a close with monetary and military hawks prevailing, and financial markets nursing some of the worst setbacks in decades.

Russian President Vladimir Putin is set to host a Kremlin ceremony on Friday annexing about 15% of Ukraine, after what Ukraine and Western countries said were sham votes staged at gunpoint in Russian-occupied areas of Donetsk, Luhansk, Kherson and Zaporizhzhia.

Washington and the European Union are set to impose additional sanctions on Russia over the annexation plan.

In markets, the U.S. dollar is finishing the quarter with its reign unchallenged, even as a hot German inflation print has investors betting the European Central Bank will get more aggressive, Britain intervenes to shore up gilts and the pound and China girds for a heavier yuan defence.

Later in the day, we will be told how much Japan spent last week defending the yen, and gauge how many rounds of ammunition it has left, given only $135.5 billion of its $1.3 trillion in reserves are held in the form of deposits.

Readings for inflation in the wider 19-country euro zone are also due on Friday and likely to exceed economists' forecasts.

That comes on the heels of hot weekly U.S. unemployment claims data which confirmed the Fed will stay on its aggressive monetary policy tightening path.

The euro-dollar rate is cornered as hawks circle on both ends. Germany, meanwhile, has a new defence shield worth 200 billion euros, but that's just for power costs.

Key developments that could influence markets on Friday:

India rates decision

Germany Aug retail sales, jobs data

Euro zone Sept flash CPI

Fed Reserve Vice Chair Lael Brainard and Fed Reserve Bank of New York President John Williams speak at conference on monetary policy

EU energy ministers meet

S&P reviews Turkey, Poland credit ratings

(Reporting by Vidya Ranganathan; Editing by Jamie Freed)