The U.S. central bank was widely expected to be hawkish, with financial markets pricing in a 65 percent chance of a 50 basis point cut on Wednesday. Economists polled by Reuters had expected a 25 basis point cut.
The CME Group’s FedWatch tool indicates that financial markets are pricing in an additional 70 basis points of rate cuts in 2024 and 191 basis points by September 2025.
The dollar index, which measures the greenback against a basket of six major currencies, fell 0.30 percent to 100.57. It had slipped to its lowest level in more than a year at 100.21 in the previous session.
Federal Reserve policymakers on Wednesday forecast another half-percentage-point cut in the benchmark interest rate by the end of this year, a full percentage point next year and a half-percentage point in 2026, but said expectations for that distant future were not necessarily certain.
The Australian and New Zealand dollars were supported by encouraging local data.
The Australian dollar rose 1.05 percent to $0.6834.
Meanwhile, the New Zealand dollar rose 0.89 percent to $0.6263 after data showed New Zealand’s economy contracted 0.2 percent in the second quarter, better than expectations of a 0.4 percent contraction.
The dollar rose 0.54 percent against the yen to 143.07.
The euro rose 0.46 percent to $1.1169, but remained below a three-week high hit in the previous session.
The Norwegian krone rose in London trading and gained slightly after the central bank kept Interest rates The crown was last up 0.64 percent at 10.4550 against the dollar.
