Dollar Steadies as Fed Keeps Rates Unchanged Amid Geopolitical Tensions

The US dollar found its footing on Thursday after the Federal Reserve kept interest rates unchanged. Chair Kevin Warsh's comments following the decision left markets guessing about future tightening, with three committee members dissenting in favor of a rate hike. The dollar index nudged up 0.1% to 100.89 after the US announced air strikes in Iran.

The British pound weakened by 0.1% at $1.3355 ahead of the Bank of England's interest rate decision, while the euro slid 0.1% to $1.1457. The Australian and New Zealand dollars remained steady, and the yen was unchanged at 163.455 yen per US dollar.

Treasury bonds reacted violently to the Fed decision, with the 30-year yield climbing to its highest level in almost two decades. Analysts pointed out that Chair Warsh's vagueness on future tightening raised concerns about the Fed's ability to keep long-term inflation expectations anchored.