FXStreet reports that economists at TD Securities analyze three scenarios which the Fed can take at its meeting and the market reaction on the USD/JPY and EUR/USD pairs.

"Hawkish (15%): The Fed notes dramatic weakening in the economy but suggests that it has eased enough for second-half recovery and announces new scaling down of QE as market functioning is largely back to normal. USD/JPY 108.10 EUR/USD 1.0730."

"Base case (60%): The Fed notes dramatic weakening and reiterates it will 'use its full range of tools.' The chair expresses optimism that actions to date will help the recovery process but emphasizes that more easing will occur as needed. USD/JPY 106.50 EUR/USD 1.0850."

"Dovish (25%): The Fed notes dramatic weakening and reiterates it will 'use its full range of tools' and that Fed assets are likely to rise significantly. The chair highlights the likely need to remain at the ELB for a very long time and for QE to provide more stimulus. USD/JPY 106.20 EUR/USD 1.0950/80."