• Aussie hits session high at 0.6475 after Fed decision.
• The market has perceived the balance sheet tilted to the dovish side.
• The FOMC will factor in policy lags for future hikes.

The USD reacted negatively immediately after the release of the Fed’s monetary policy decision. The Aussie, which had been trading in a tight range above 0.6400, has risen to session highs of 0.6470 so far.

Investors see dovish attitude in Fed statement

As expected, the bank has raised the federal funds rate by 75 basis points, for the fourth consecutive time, to the range of 3.75% to 4.00%.

However, the bank’s statement has leaned to the dovish side. The committee notes that, in determining the pace of future rate hikes, they will take into account “theaccumulated hardening of the politics monetary the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.”

In addition, the bank has warned about recent indicators that point to a modest growth in spending and production.

Technical levels to watch