FXStreet reports that economists at MUFG Bank said that while there is still scope for further USD gains over the short-term, the upside from here is beginning to diminish.

“The FOMC and Chair Powell could not have provided much more of a dovish communication to the markets but the response is as we had suspected – price action indicating a high degree of scepticism.”

“We believe the financial market implications from the FOMC meeting will be a further steepening of the US yield curve. Our conviction on the USD is relatively low and relative FX trades may provide greater opportunity over the coming months with Fed policy proving successful in anchoring short-term yields, curtailing the extent of USD strength while the macro backdrop remains USD supportive.”