EUR/USD jumps above 1.0800 to fresh six-week highs as Fed raises rates as expected

• FOMC raises key rate by 25 bps as expected, despite recent turmoil. 
• US Dollar tumbles after FOMC statement, attention turns to Chair Powell. 
• EUR/USD breaks 1.0800 and climbs toward 1.0850.

The EUR/USD jumped from 1.0790 to 1.0845, following the decision of the Federal Reserve (Fed) to raise interest rates by 25 bps as expected. The US Dollar tumbled as US yields dropped sharply. 

Fed moves as expected

The Federal Reserve (Fed) raised its key interest rate by 25 bps as expected to 4.75% -5.00%. The vote was unanimous. They dropped the forward guidance, mentioning that “some additional policy firming may be appropriate”, instead of “ongoing increases in the target range will be appropriate”. In a few minutes, Chair Powell's press conference will begin. 

The US Dollar dropped sharply boosting the EUR/USD to the upside. Markets are looking at the decisions as a “dovish hike”. Wall Street indices printed fresh highs. The improvement in risk sentiment weighs on the US dollar. 

Technical levels