• Fed keeps rates unchanged as expected at 5.25-5.50%. 
• The Summary of Economic projections implies one more 25 bps rate hike this year.
• US Dollar rises sharply after the FOMC statement, weighing on Gold. 

Gold took a step down on reaction to the Federal Reserve's (Fed) rate call for Wednesday, with the XAU/USD testing the waters in the $1,940.00 region.

The Fed kept its benchmark interest rate at 5.5% as investors broadly anticipated, but the US central bank saw an uptick in their forward-looking inflation expectations.

Markets are seeing the 1-year Fed inflation expectations lifting half a percent to 5.1% from the previously recorded 4.6%.

The XAU/USD fell off the $1,946.00 level after the release, declining into challenge range of the $1,940.00 handle.

Read more:

Fed Statement comparison: September vs July

Breaking: Fed leaves interest rate unchanged at 5.25%-5.5% as expected