The FOMC delivered a 75 bps hike. The US Dollar Index (DXY) snapped a five-day winning streak on Wednesday following the Federal Reserve's policy announcements. Economists at Scotiabank expect DXY to struggle to surpass the 105 area.

USD may struggle to improve

“For now, with the Fed looking fully priced and spreads not making new ground in the USD’s favour, the USD may struggle to improve.”

“Supportive cash bond spreads suggest the USD may not fall too far for now but unless yield differentials can make new highs, we still rather think the DXY will struggle to better the 105 area, where it peaked in May.”