The FOMC decision was released at 4am AEST and it was the catalyst for a big sell-off in the US dollar because the US Fed downgraded its growth projections for 2015 and slightly lowered the projection for rate increases in 2016.
That meant even though the Fed is still signalling the first rate hike will occur this year, and even though the famous ‘dot point‘ suggest two hikes, traders read the Fed as dovish.
That means they don’t think the Fed is going to aggressively hike rates.
As a result, the US dollar got thumped and the Aussie dollar, which had been under acute pressure overnight, recovered all its gains as it roared higher.
Here’s the chart.
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