Kit Juckes, Research Analyst at Societe Generale, suggests that the FOMC left rates on hold as expected but the text of the statement was less hawkish than expected. Key Quotes “Where the median point of the famous ‘dot plot’ showed 4 rate increases this year, it now shows only two and growth forecasts were lowered, despite the unemployment projection coming down too. Our conclusion - a hike in April is all but impossible and while a move in June is possible it isn’t certain. We look for one hike in 2016. The fed seems concerned about how low inflation expectations have fallen and ants to get them higher, which is the same as saying that they want breakeven inflation rates to move higher. It is also reasonable to conclude that the Fed has no interest in pushing the dollar higher. The BOJ and ECB having failed to weaken their currencies by driving rates (even) lower, a stronger dollar depends on the Fed being as or more hawkish than the market expects, and that is clearly not happening. So, no reason to by the dollar, and while neither yen nor Euro look attractive either, the higher-yielding (or less low-yielding) currencies all benefit. Risk is ‘on’ and our preference for currencies whose valuations have been dragged down by weak oil prices remains in place.” For more information, read our latest forex news.