The Fed raised rates.

The market saw it coming. What it didn't see coming was the tone.

Yesterday, the Federal Reserve raised rates by 25 basis points to 3.75%–4.00%, its first hike since 2023. The message was more hawkish than expected: inflation has been "too high for too long", 16 of 18 members see room for another hike this year, and inflation isn't expected to normalise until 2029.

The result: the dollar climbed to a 7-week high. EUR/USD, which was above 1.1600 before the decision, is now testing support at 1.1500.

In practice, a USD 100,000 purchase locked in before the decision would cost almost €750 more today.

Is your company protected against this kind of swing, or deciding one exchange rate at a time?

#EURUSD #Fed #FXRisk #FinancialMarkets #CaisCapital