Dollar Ends Last FOMC Week in 2014 on Strong Note

This week was important for the Forex market and the US dollar in particular. The Federal Open Market Committee held its last policy meeting in 2014, and it could make or break the future for the US currency. As it turned out, the event was beneficial for the greenback.
The dollar did not rally after the FOMC gathering immediately. On the contrary, the greenback dropped initially as traders considered the policy statement less hawkish than was expected. Yet the drop was short-lived as market participants reconsidered their view, especially after Federal Reserve Chairwoman Janet Yellen made some hawkish remarks at a press-conference.
The Fed was not the only central bank to hold policy meeting during this week, and policy decisions of other banks were impactful as well. The Swiss National Bank roiled the market implementing negative interest rates. As one could expect, it had a very negative effect on the Swiss franc. The Bank of Japan did not change its monetary policy, but the fact that expansive monetary accommodation remained in place was enough to drive the Japanese yen down.
EUR/USD sank from 1.2471 to 1.2226 (1.8 percent) over the week, closing at the lowest weekly settlement since July 2012. USD/JPY fell from 118.67 to 115.56 during the week but bounced to settle at 119.53. USD/CHF rallied from 0.9633 to 0.9843 — also the highest weekly close since July 2012.

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