Having signalled further rate rises as recently as December, the U.S. central bank announced it is putting plans for further rate hikes on hold and pledged to be “patient” on further moves in its January meeting, citing muted inflation and rising risks to global economic growth.
Market watchers will be tuned in to remarks by Cleveland Fed President Loretta Mester on Monday and St Louis Fed President James Bullard on Friday. Fed Chairman Jerome Powell is due to speak on Wednesday, but it is unclear if his remarks will address monetary policy.
Stronger-than-expected U.S. jobs data were cited as providing support to the greenback today.
The report showed the U.S. economy created 304,000 new jobs, the highest in 11 months, beating forecasts for 165,000 jobs.
The GBP/USD pair was little changed at 1.3077. The Bank of England is expected to keep interest rates on hold at its upcoming meeting on Thursday, amid growing uncertainty over the prospect of Britain exiting the European Union on March 29 with no deal in place.
Elsewhere, the AUD/USD pair was down 0.2% at 0.7232. The Reserve Bank of Australia is scheduled to hold a policy meeting this week.
The USD/JPY pair edged up 0.1% at 109.61.
China’s financial markets are closed this week for the Lunar New Year holiday.