U.S. Dollar Gains Slightly after Fed Statement

The dollar index gained slightly immediately after the Federal Reserve released its April statement.  The U.S. dollar index was trimming losses at 95.12, down about 1 percent, following a dovish FOMC statement. It was previously at 94.84 before the statement’s release. The euro, meanwhile, continued trading at about $1.11 against the greenback.

The Fed acknowledged the soft patches in the U.S. economy, making it more likely it will not be ready to raise rates until at least September. But it did say the slowdown in the U.S. economic growth during the winter months was due partly to transitory factors, a statement that supported the dollar.

“The fact that policymakers continue to view the key drivers of the slower growth as ‘transitory’ suggests that their view of the economy may be slightly more upbeat than the color of recent economic reports may suggest,” said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.