EUR/USD whipsaws post-FOMC, Fed Chair Powell speech on deck

• EUR/USD whipsawed above 1.1500 following the Fed's latest rate call and dot plot update.
• The FOMC still sees 50 basis points in cuts in 2025, but policy uncertainty has widened the dot spread.

EUR/USD whipsawed on Wednesday after the Federal Reserve's (Fed) Federal Open Market Committee (FOMC) kept interest rates unchanged, as investors had broadly expected. Fiber continues to churn in a long-tailed midrange near the 1.1500 handle as traders await Fed Chair Jerome Powell's upcoming press conference and follow-up Q&A session.

The Fed still sees an average of 50 basis points in interest rate cuts by the end of the year, following closely with what is priced in according to the CME's FedWatch Tool; however, ongoing trade policy uncertainty has pushed the spread of policymaker rate expectations wider, with some Fed personnel seeing higher year-end rates compared to the previous Summary of Economic Projections (SEP).

more to come...

Market reaction

Intraday price action saw an immediate step-up in volatility post-FOMC release, but overall momentum remains tight as investors await Fed Chair Powell.

EUR/USD 5-minute chart