The dollar weakened against its peers today leading up to the FOMC’s announcement to weaken even further with the US dollar index plunging to 96.75 at the close of the session. Federal Reserve chair Yellen stated that the Fed will no longer be “patient” with regards to when a rate increase will take place however an increase slated for April most probably will not occur. The market widely anticipates a rate hike around June this year.

The euro strengthened against the dollar leading up to the Fed as it was still supported by data released yesterday which revealed that German economic sentiment was at its highest level in 13 months for March. The euro rallied significantly on the back of the Fed’s statement as rates will most probably be increased this year.

The pound weakened against the dollar with the pair dropping over 0.6% leading up to the Fed’s announcement after which the pound regained lost ground. Earlier the UK Office for National Statistics reported that the UK’s unemployment rate remained unchanged at 5.7% for the last quarter of 2014 compounding forecasts for a tick down to 5.6%. The employment data sent the pound to close to 5 year lows before trimming losses. The UK average earnings index jumped 1.0% for the same period just short of expectations for a 2.2% increase.

The yen strengthened against the dollar with the pair down over 0.4% trading below its 121 handle leading up to the Fed’s announcement. The yen had lost ground after having been supported by the Bank of Japan’s announcement to leave its stimulus program unchanged as the market awaited the Fed. After the announcement the yen retraced within its recent tight range.

The Australian and New Zealand dollars were stronger against the greenback while the Canadian dollar held its ground leading up to the announcement. Data released by Statistics Canada revealed that wholesale prices declined by 3.1% in January while experts had forecast a 1.0% decline pushing the loonie to new 6 year lows against the dollar.

Disclaimer: This information has been prepared to provide you with general information only. It is not intended to take the place of professional advice and you should not take action on specific issues in reliance on this information.