Commerzbank FX team said the dollar briefly weakened and the euro rallied after the Fed held rates but revealed significant internal dissent. Three officials voted for a 25bp hike, stoking inflation concerns; markets read the decision as less hawkish overall, sending the US 2-year Treasury yield and the dollar lower while US long-term yields rose sharply as investors judged the Fed response insufficient to curb persistent inflation. Federal funds futures put the probability of a 25bp September h

Commerzbank FX team said the dollar briefly weakened and the euro rallied after the Fed held rates but revealed significant internal dissent. Three officials voted for a 25bp hike, stoking inflation concerns; markets read the decision as less hawkish overall, sending the US 2-year Treasury yield and the dollar lower while US long-term yields rose sharply as investors judged the Fed response insufficient to curb persistent inflation. Federal funds futures put the probability of a 25bp September hike at 63%. Market-implied cumulative hikes for the year have been trimmed to 33bps from 42bps on Tuesday.