Despite unchanged rates the Fed, through its statement and dot plots, will hold out the possibility of one further hike to the 5.50-5.75% range later this year.

Even though we should see 25 bps rate hikes across four European central banks through the week we doubt the Dollar has to lose much ground – if any.

DXY remains relatively strong and there does not seem a case for a decisive turn lower this week – unless we are all surprised by the Fed. 

There is a strong band of resistance in the 105.40/105.80 area, which may well cap this week. But equally, DXY should continue to find decent demand below 105.00.