From The Age:
The Federal Reserve raised its benchmark lending rate a quarter point and continued to project two more rate increases this year, signalling more vigilance as inflation approaches its target.
“In view of realised and expected labour market conditions and inflation, the committee decided to raise the target range for the federal funds rate,” the Federal Open Market Committee said in its statement on Wednesday. “Near-term risks to the economic outlook appear roughly balanced.”
Surprisingly, the Dollar Index fell sharply on news of the announcement. But selling was mainly traders who had anticipated a more hawkish stance on future rate increases.
Investors had anticipated the tightening. In fact, Treasury yields had climbed with the dollar on speculation the central bank might signal a faster pace of rate rises. But those trades unwound quickly after the announcement.