EUR/USD slumps as Fed holds rates; Waller and Bowman dissent

• Fed keeps rates steady; two Governors voted for a 25-bps cut.
• Statement flags "elevated uncertainty" and moderate growth in H1.
• EUR/USD trades choppy near 1.1475, eyes key support at 1.1450.

The EUR/USD extended its losses during the North American session, as the Federal Open Market Committee (FOMC) held rates unchanged, in a vote split, that witnessed two Governors, favoring a 25-bps rate cut.  At the time of writing, the pair trades volatile at around 1.1475-1.1500, negative on the day.

Euro weakens over 0.50% as Powell's press conference looms, with markets digesting split Fed vote

Federal Reserve officials noted in the statement that economic activity moderated in the first half of the year, while the unemployment rate remains low and inflation is "somewhat elevated." Policymakers reaffirmed their commitment to achieving maximum employment and returning inflation to the 2% target, while acknowledging that "uncertainty about the economic outlook remains elevated."

The statement also confirmed that the Fed will continue reducing its holdings of Treasury securities, agency debt, and agency mortgage-backed securities. Attention now turns to Fed Chair Jerome Powell's press conference, scheduled for 18:30 GMT.

EUR/USD reaction to Fed's decision

The EUR/USD seesawed within the 1.1476-1.1496 range, remaining slightly volatile as traders brace for the Fed Chair Jerome Powell press conference. Nevertheless, the pair remains down by over 0.53% in the day, with key resistance seen at 1.1500, followed by the day's peak at 1.1572. Further upside lies at 1.1600.

Conversely, if the pair tumbles below 1.1450, this clears the path to 1.1400. On further weakness, the next area of interest would be the 100-day SMA at 1.1350.