• USD/JPY rebounds after a sharp fall as Dollar bids recover post-Fed.
• Fed leaves rates unchanged, cautions uncertainty in economic outlook.
• Markets await Fed chair Powell press conference for dovish hints.

The USD/JPY rebounded in rough chart action after the Federal Reserve (Fed) left rates unchanged with additional cautionary concerns about needing the economic outlook to be more certain and better indicators that US inflation will fall to and stay at 2% moving forward. The Fed sparked a risk-off run that bolstered the US Dollar (USD) on reaction as markets await further details from Fed Chairman Jerome Powell, due to speak at the bottom of the hour.

Fed leaves policy rate unchanged at 5.25%-5.5% as expected

Money markets are now pricing in a 52% chance of no rate cut in March as swap rates pivot to focus on odds of a first cut from the Fed in May, according to the CME's FedWatch Tool.

USD/JPY technical outlook

USD/JPY tumbled into the 146.00 handle early Wednesday, backsliding 1.22% peak-to-trough from the day's peak bids near 147.88.

The pair is pulling back into the midrange below the 147.00 handle after the pair tested its lowest prices in almost three weeks.

USD/JPY Hourly Chart