Forex Today: Bulls are all over the place after the Fed’s decision

What you need to take care of on  Thursday, July 28:

The American dollar plunged on Wednesday following the US Federal Reserve monetary policy decision. The central bank delivered as expected and hiked the main benchmark rate by 75 bps.

Financial markets reacted to chief Jerome Powell's words, as he shed quite some light on the future of monetary policy. Firstly, he said that rates had reached neutrality, so there won't be any more forward guidance. Rates will be decided meeting by meeting.

For most of the press conference, Powell tried to cool down recession fears, and he clearly succeeded. He noted that nothing works without price stability, somehow saying that keeping inflation under control is more relevant than any potential economic bump in the road.

Wall Street soared. The DJIA added 1.43%, while the S&P500 added 2.91%. The Nasdaq Composite was the best performer, soaring 4.12%.

The US Treasury yield curve shrank a bit, with the 10-year note now yielding 2.80% and the 2-year note 3%. A bit of progress there, reflecting temporarily easing recession concerns.

The EUR/USD pair jumped above 1.0200. Market temporarily put aside EU turmoil, which may soon make it back to the headlines. GBP/USD trades at 1.2160 at the end of the day, while commodity-linked currencies were the best performers. AUD/USD trades around the 0.7000 threshold, while USD/CAD fell towards 1.2800.

Safe-haven assets also beat the dollar. USD/CHF is down to 0.9590, while USD/JPY slid to trade at 136.50.

Spot gold is up, now trading at $1,733 a troy ounce, while crude oil prices also benefited from the risk-on sentiment. WTI trades around $98.05 a barrel.

The US will release the preliminary estimate of its Q2 Gross Domestic Product on Thursday, another volatile event that would bring action to financial markets.