EUR/USD maintains its strength as the market awaits tonight's developments.
The most widely traded currency pair is filled with expectations on Wednesday, with the current EUR/USD exchange rate at 1.0780.
The two-day meeting of the US Federal Reserve is coming to a close tonight. Market participants anticipate that monetary policymakers will choose to pause the series of interest rate increases for the first time in 15 months. However, they are likely to maintain their stance towards a tight credit and monetary policy.
Federal Reserve Chair Jerome Powell previously emphasized the preference for delaying further rate hikes in order to evaluate the impact of previous actions on the economy. Moreover, the Fed believes it is necessary to take targeted measures to prevent individual bank failures instead of implementing broad-scale interventions.
With inflation currently exceeding the target level by more than double, the Fed is expected to emphasize that it is leaving the possibility of another rate hike open for either July or September.
The current interest rate stands at 5.25% per annum, and the market expects it to remain unchanged.
As the afternoon approaches, volatility in EUR/USD is likely to increase, so exercising caution is advisable.