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EUR/USD has been on the back foot, sliding below 1.18, hitting new weekly lows. The US dollar is strengthening in response to the Federal Reserve’s rate decision. The Fed left its policy unchanged and signaled no changes to borrowing costs potentially through 2023.

Markets had already priced in low interest rates for the next few years and have responded with boosting the greenback on the lack of new stimulus. The Fed’s growth projections point to a return to pre-panemic levels by the end of 2021. 

Federal Reserve Chairman Jerome Powell said the current level of bond-buying is appropriate and said “my sense is that more fiscal support is likely to be needed” – seeming to hint that the ball for more support is in Congress’ court. 

Euro/dollar has dropped below the 50, 100, and 200 Simple Moving Averages on the four-hour chart, and momentum has turned negative. Investors are eyeing last week’s low of 1.1755 and the daily high of 1.1880 as broad limits of the current range.