The US dollar is 50-70 pips higher across the board following the FOMC decision.
The announcement of no change in rates was largely priced in but what caught the market off guard was a rise in the Fed’s dot plot to indicate that the median of policymakers see rates at 5.6% at year end. That would imply two more rate hikes before year end.
At the same time, the 2024 dot moved up to 4.6% from 4.3%, suggesting a higher-for-longer path.
The reaction from the market was immediate with USD/JPY climbing to 140.18 from 139.43.
USDJPY 10 mins
Fed chairman Powell will hold a press conference at the bottom of the hour. It will be pressed on how certain he is that two more rate hikes are coming.