The dollar reversed its slide yesterday, buoyed by stronger equities, but has fallen back today

Despite a reassertion that US interest rates would stay low, the dollar advanced over half a cent against the single currency yesterday as global stocks went into decline.

• During early European trading yesterday, the intense selling pressure on the dollar abated amid caution ahead of the Fed’s rate decision, with the pair holding around the 1.4800 level.
  
• In the evening, the statement from the Fed confirmed speculation that rates would remain low for an extended period of time, which sent the euro to a high of 1.4841.
  
• However, the greenback rebounded strongly, as traders remained cautious of betting aggressively against the US dollar following a sudden slide in US stocks.
  
• With rates set to stay at near zero for some time, analysts say that investors are likely to quickly return to funding carry trades in dollars, sending it lower once more.
  
• Indeed, the euro has made ground this morning following a business confidence survey in Germany that showed improvement from last month.