Fed’s indication of slow rate hikes gives relief – USD holds losses 

Daily Currency Update

With Wall Street shut for Thanksgiving and the US dollar close to a 3-month low, USD seized onto losses minutes after the Fed backed the idea of the central bank raising the rates in smaller steps from next month.

Officials were principally content they could now move in smaller steps, with a 50 bp rate rise likely in December after four consecutive 75 basis point increases.

"The Fed will be happy to move rates by 50 basis points in December and 25 basis points from the first meeting next year," said Niels Christensen, chief analyst at Nordea, noting that the Fed will still feel it needs to do more to bring inflation down.

The USD index was down 0.1% at 105.82, after it slid 1.1% on Wednesday.

The Fed has taken interest rates to levels not seen since 2008. However, somewhat cooler-than-expected U.S. consumer price data has stoked expectations of a more moderate pace of hikes.

WTI spot price is at a current level of 79.74, down from 80.07 the previous market closing.