The US Dollar Index (DXY) jostled but overall remained in Wednesday’s trading neighborhood after the Federal Reserve (Fed) delivered its standard interest rate decision, holding interest rates steady in the 3.5-3.75% range and noting its data-dependent approach.
Market action will continue to remain limited but jittery as investors await the latest showing from Fed Chair Jerome Powell. Fed Chair Powell will be in the hotseat as investors keep an eye out for any shifts in his policy rhetoric following the Fed head’s press conference. Markets will also be anticipating questions surrounding the ongoing Department of Justice (DOJ) criminal investigation into Fed Chair Powell, brought forth by the Trump administration largely as retribution for failing to deliver interest rate cuts at a pace that satisfies the current president.
The DOJ has subpoenaed Fed Chair Powell regarding the Fed’s expenditures on a long-planned government office overhaul. The overwhelming majority of expenditures associated with the Fed office refurbishment were assigned and approved during Trump’s first term.
DXY five-minute chart
Economic Indicator
Fed Interest Rate Decision
The Federal Reserve (Fed) deliberates on monetary policy and makes a decision on interest rates at eight pre-scheduled meetings per year. It has two mandates: to keep inflation at 2%, and to maintain full employment. Its main tool for achieving this is by setting interest rates – both at which it lends to banks and banks lend to each other. If it decides to hike rates, the US Dollar (USD) tends to strengthen as it attracts more foreign capital inflows. If it cuts rates, it tends to weaken the USD as capital drains out to countries offering higher returns. If rates are left unchanged, attention turns to the tone of the Federal Open Market Committee (FOMC) statement, and whether it is hawkish (expectant of higher future interest rates), or dovish (expectant of lower future rates).
Last release:
Wed Jan 28, 2026 19:00
Frequency:
Irregular
Actual:
3.75%
Consensus:
3.75%
Previous:
3.75%
Source:
Federal Reserve
