The dovish tone of the Fed's statements pushed the dollar index down to two-week lows.
As expected by many analysts, the Fed's monetary policy remained unchanged. This decision is explained by the fact that the economy has already made the necessary progress in terms of employment and inflation.
The main impetus for the dollar would have been the specifics about the start of the stimulus curtailment, but the Fed softened its tone and shied away from this issue.
This is likely due to the continued rise in new cases of COVID-19, which is likely to lead to continued monetary stimulus until at least the end of 2022. Many analysts believe that the continued infusion of new money into the US economy is an extremely negative factor for the dollar and extremely dangerous.
The Fed is trying to avert a liquidity crisis, but markets continue to see the Fed's actions as just a "printing press" policy.
According to Jerome Powell, the head of the Fed, there is still a long way to discuss raising interest rates and the central bank will give many signals to the market so as not to catch a wide range of investors by surprise.
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