Dollar Jumps to November 2022-Highs
The dollar index soared about 0.6% to 107.6 on Wednesday, reaching the highest level since November 2022, after the Federal Reserve cut the fed funds rate by 25bps as expected, but delivered a hawkish view for 2025. Policymakers now anticipate just a 50bps reduction next year, compared to a full percentage point expected last quarter.
In addition, the Fed revised its projections for next year, raising GDP growth and inflation forecasts while lowering the unemployment rate. The odds for a pause in rate cuts in January increased to about 88% compared to 80% before the FOMC decision.
The greenback strengthened across the board, with its largest gains recorded against the Australian dollar, the euro, the British pound, and the yen.
Source: Trading Ecnomics