The U.S. dollar strengthened against its major counterparts in the Asian session on Thursday, after the Federal Reserve kept its interest rate on hold, but dashed investors’ hopes for a near-term interest rate cut.
In his post-monetary policy meeting press conference, Powell said a fall in inflation this year could be due to transitory factors.
Powell said the Fed would take persistently low inflation into account when setting policy but currently expects inflation to return to the 2 percent objective.
The Fed reiterated it will be patient as it determines future adjustments to interest rates due to global economic and financial developments and muted inflation.
The Fed maintained the target range for the federal funds rate at 2.25 to 2.50 percent for the third consecutive meeting.
Investors await U.S. reports on weekly jobless claims, labor productivity and costs, and factory orders today, as well as monthly jobs report on Friday.
The greenback advanced to a 2-day high of 111.67 against the yen, from a low of 111.35 hit at 6:00 pm ET. The greenback is seen finding resistance around the 113.00 level.
The greenback was trading higher at 1.1199 against the euro, up from near a 2-week low of 1.1265 seen on Wednesday. Next key resistance for the greenback is seen around the 1.10 level.
The greenback edged up to 1.3038 against the pound, following a low of 1.3060 touched at 9:15 pm ET. On the upside, 1.28 is possibly seen as the next resistance level for the greenback.
The U.S. currency ticked up to 1.0184 against the franc, after falling to 1.0170 at 6:30 pm ET. The next key resistance for the greenback is likely seen around the 1.03 region.
Looking ahead, PMI reports from major European economies are due in the European session.
At 7:00 am ET, the Bank of England announces its interest rate decision. Economists widely forecast the benchmark to remain at 0.75 percent and asset purchase program at GBP 435 billion.
In the New York session, U.S. weekly jobless claims for the week ended April 27 and factory orders for March are scheduled for release.
The material has been provided by InstaForex Company – www.instaforex.com