Dollar drops as Fed raises rates, leaving 2018 forecast unchanged

The U.S. dollar dropped against its major rivals after the Federal Reserve hiked interest rates by 25 basis points on Wednesday and left its forecast for future rate hikes and inflation unchanged. A news conference, which will be the last of current chairwoman Janet Yellen before she hands over the reins to Jerome Powell, will follow at 2.30 p.m. Eastern. The rate hike had been much anticipated by traders and was priced almost entirely into Fed funds futures, which put more weight on the central bank's forward guidance. But traders were looking for clues for 2018 policy were disappointed. The greenback briefly fell to new session lows, with the ICE U.S. Dollar Index slipping by 0.5% at 93.635, while the euro , the buck's main rival, rose 0.5% to $1.1798. Follow live: Fed decision and Janet Yellen press conference

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.