By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) – The dollar edged higher on Wednesday in choppy trading after the Federal Reserve raised interest rates as expected for the eighth time, flagged more rate hikes and signaled the end of the “accommodative” policy era.
The greenback briefly fell against the euro and yen after the release of the Fed statement but slowly inched higher as market participants digested the statement.
Fed policymakers lifted the benchmark overnight lending rate by a quarter of a percentage point to a range of 2.00 percent to 2.25 percent. The central bank also removed from its policy statement a description of monetary policy as remaining accommodative.
“Today’s dropping of keyword ‘accommodative’ from its policy statement ensures the Fed remains on course for further hikes as unemployment heads towards multi decade lows,” said Robert Sierra, director at Fitch Ratings.