Breaking: Fed leaves rates unchanged, dollar edges higher

The Federal Open Market Committee (FOMC) on Wednesday announced that it left the benchmark interest rate, the target range for federal funds, unchanged at 0%-0.25% as widely expected. In its policy statement, the Fed reaffirmed its commitment to using the full range of tools to continue to support the economy.

Follow our live coverage of the FOMC decision and the market reaction.

Market reaction

With the initial reaction, the greenback gathered some strength against its rivals and the US Dollar Index (DXY) rose to 91.00 before losing its traction. As of writing, the DXY was down 0.13% at 90.78.

Additional takeaways as summarized by Reuters

"Fed will continue to increase bond purchases by at least $80 billion/month of treasuries and $40 billion/month of MBS until substantial further progress made on maximum employment and price stability goals."

"Will maintain current fed funds rate until labor market has reached maximum employment and inflation has risen to 2% and is on track to moderately exceed that for some time."

"Will maintain accommodative policy until inflation runs moderately above 2% for some time, so that inflation averages 2% over time and longer-term inflation expectations remain well-anchored at 2%."

"Will be prepared to adjust monetary policy stance as appropriate if risks emerge that could impede the attainment of Fed’s goals."

"Indicators of economic activity and employment have strengthened amid progress on vaccinations, strong policy support."

"Sectors most adversely affected by pandemic remain weak but have shown improvement."

"Inflation has risen, largely reflecting transitory factors."

"Path of economy will depend significantly on the course of the virus, including progress on vaccinations."

"Public health crisis continues to weigh on economic activity and risks to the outlook remain."

"Overall financial conditions remain accommodative."

"Fed vote in favor of policy was unanimous."