USD/JPY Gains as Fed Does Not Mention QE3

The US dollar gained against the Japanese yen today before retreating to the opening level as the Federal Reserve refrained from adding stimulus to the US economy. The currency remained lower versus the euro and the Great Britain pound.

Some analysts anticipated some dovish remarks from the Fed today. Such expectations didn’t come true as the Federal Open Market Committee said in its statement:

The Committee expects economic growth to remain moderate over coming quarters and then to pick up gradually.

The FOMC remained rather neutral in the statement, mentioning an improvement of employment and housing

markets, but saying that “the unemployment rate has declined but remains elevated” and ”the housing sector remains depressed”. The Committee maintained its main interest rate stable near zero and reiterated the pledge to keep rates low till late 2014.

The reaction of the dollar wasn’t as strong as might expect. The greenback climbed against the yen, but later retreated. The pound and the euro were almost unfazed by the monetary decision.

USD/JPY climbed from 81.30 to 81.69 before trading at 81.34 as of 20:08 GMT today. EUR/USD was up from 1.3195 to 1.3218 and GBP/USD went higher from 1.6142 to 1.6170.