Investing.com - The dollar rallied on Thursday, hitting the highest level since January 2003 against a currency basket after the Federal Reserve hiked interest rates and signaled it expects to raise rates more quickly than previously anticipated in 2017.
Wednesday’s rate was largely priced in by markets, but the dollar surged after the U.S. central bank predicted it would raise interest rates three times in 2017, up from the two hikes predicted in September.
“Our decision to raise rates should certainly be understood as a reflection of the confidence we have in the progress the economy has made,” Fed Chair Janet Yellen said.
Yellen also reiterated that the Fed would take a wait-and-see approach before deciding how to react to U.S. President-elect Donald Trump’s economic agenda.
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