Asian session review: the US dollar consolidated against most currencies

During today's Asian trading, the US dollar was trading stable against most major currencies after the Federal Reserve meeting.

Yesterday, the Fed kept the interest rate on federal loan funds in the range of 0% to 0.25% per annum. The Fed also said it will continue to buy back $120 billion worth of assets each month, including $80 billion worth of US Treasuries and $40 billion worth of mortgage bonds.

Fed Chairman Jerome Powell said during a news conference that the US economy is recovering from the crisis caused by the COVID-19 pandemic faster than expected, but the recovery "remains uneven and far from complete."

As Powell noted, the time has not yet come to discuss the possibility of reducing the amount of monetary stimulus, which provides "strong support" to the economy.

Maintaining low interest rates in the face of an improving situation in the US and in the global economy is a recipe for further weakening of the dollar, CBA experts said. The risk is that the Fed will be too cautious and delay the first steps to normalize monetary policy, according to the CBA.

The ICE index, which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona), rose by 0.02%.