Federal Reserve leaves rates unchanged at 4.25-4.50%

• There was no expectation of a cut today
• The Fed had cut at the prior three meetings for a total of 100 bps
• The reference in the prior statement about inflation making progress towards 2% goal is removed
• The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance
• The Committee is attentive to the risks to both sides of its dual mandate
• The unemployment rate has stabilized at a low level in recent month
• Labor market conditions remain solid.
• Inflation remains somewhat elevated.

Prior to the meeting, the market was pricing in 46.2 bps in easing this year. USD/JPY was trading at 155.15.

There is some USD strength in the aftermath of the decision as the comments in the statement suggest the Fed is more ‘neutral’.

These are the only notable changes in the statement.

I’m not sure removing that line about progress is really notable. We will wait to hear from Powell at 2:3

This article was written by Adam Button at www.forexlive.com.