The US dollar initially rallied on the Fed decision
EUR/USD was trading right at 1.1000 as the FOMC statement crossed on the newswires but it quickly fell to 1.0961. That held the weekly low in the euro (which I highlighted before the decision). After the quick dip, the pair has recovered to 1.0980.
Highlights of the statement and the redline are here.
There is no smoking gun here but I think the dollar can still strengthen from here.
The Fed had an opportunity to kill expectations of hikes, but with all the positive comments here and adding in a line about lower near-term risks, they certainly give themselves a chance to signal a hike in September if the data continues to improve.
