The Fed raised interest rates by 50 bps and announced the start of QT on Wednesday as largely expected. Less anticipated were Fed Chair Powell’s comments discounting the near-term prospects of hikes greater than 50 bps at future meetings. US 2yr and 10yr yields fell as a result and EUR/USD eventually rose to an eventual high of 1.06420 in early morning trading before pairing back some of its gains. How does this shift in Fed calculus change the prospects for the euro?
