BENGALURU: Indian shares were subdued on Wednesday as investors turned cautious ahead of the U.S. Federal Reserve's decision on interest rates and its impact on the world's largest economy, while energy stocks slid after clocking gains recently.

The NSE Nifty 50 index was down 0.2% at 15,698.4 by 0408 GMT, while the BSE index fell 0.2% to 52,602.4.

"Expectations for a rate hike have mostly been factored in and I expect markets to see a short-term bounce from here. A 50 bp hike would be a positive surprise," said Siddharth Khemka, head of retail research, Motilal Oswal.

Other analysts also largely expect a 50-basis-point hike at the Fed's meeting later in the day, but the possibility of a 75-bp raise has also grown after Friday's higher-than-expected consumer price index (CPI) data for May.

The spotlight on the U.S. central bank's decision comes after the Reserve Bank of India last week raised its key interest rate by 50 basis points as widely expected, in a bid to cool high inflation in Asia's third-largest economy.

The country's wholesale inflation for May surged 15.88% in May, while retail inflation eased to 7.04%, data showed earlier this week.

Among individual sectors and shares, the Nifty energy index was flat, with heavyweight Reliance Industries down 0.1%.

"People are exiting their profitable trades and with oil prices already moving up, the energy sector stocks are down today due to profit-booking," Khemka added.

Network18 Media and Investments rose 2.5% after Viacom18, in which Network 18 owns a majority stake, won digital streaming rights for the Indian cricket league IPL from 2023 to 2027.

Shares of One97 Communications were up over 2% after the company's average monthly users on its Paytm super app rose 48% for two months ending May.

(Reporting by Tanvi Mehta in Bengaluru; Editing by Shailesh Kuber and Uttaresh.V)