Dollar Consolidates After Hawkish Hold, Euro Surges

The US dollar's soft profile against most currencies continued into today, following yesterday's FOMC meeting. The Fed's decision to stand pat on a 9-3 vote was seen as hawkish, but Chair Warsh emphasized the central bank's commitment to achieving the inflation target.

The euro jumped from around $1.1400 to almost $1.1470 after the announcement, as short-term US interest rates fell. The Canadian dollar strengthened for the second consecutive session, and the US two-year premium over Canada narrowed.

Today's data release is expected to pose possible headline risk, but its impact on policy or investment decisions will likely be marginal. The market is consolidating in anticipation of the next Fed move.