Dollar steady ahead of Fed decision; focus on UK budget

The dollar held near recent levels as traders positioned ahead of the Federal Reserve's policy decision, with attention also turning to the UK budget. Because the Fed's rate path sets the US yield anchor against which other currencies are priced, currency markets tend to hold steady into such meetings while participants wait for guidance on the timing and pace of rate moves. The UK budget introduces a fiscal channel into sterling pricing, as the scale of borrowing and tax changes can reshape gilt yields and inflation expectations, which in turn affects the rate differential against the dollar. Sterling is the asset most directly exposed to the budget outcome, while the yen, Australian and Canadian dollars, and the Swiss franc are more sensitive to shifts in global risk appetite and US yield moves. Traders will be watching the Fed's post-decision statement and press conference for signals on future rate cuts, alongside gilt market reaction in the hours following the budget speech.

The US Dollar (USD) is the world's primary reserve currency and the base for most forex majors. Headlines about Federal Reserve policy, US macro data (CPI, NFP, GDP), and Treasury yield shifts typically drive USD pair direction within seconds of release.

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