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NEW YORK: The US dollar ended mixed on Wednesday as a mostly upbeat Federal Reserve assessment of the US economy sparked a temporary spurt in buying interest in the greenback.
The euro wobbled higher to 1.4191 dollars at 2100 GMT from 1.4150 dollars in New York late on Tuesday in choppy trade.
The dollar meanwhile climbed to 96.09 yen from 95.99 yen.
Traders marked time ahead of the Federal Open Market Committee announcement, which as expected maintained the rock-bottom US interest rate range of zero to 0.25 percent.
But the Fed also tweaked its statement to suggest a more optimistic outlook for recovery from recession, saying economic activity appears to be "levelling out."
The central bank said it would gradually end its programme of Treasury bond purchases after completing a 300 billion dollar programme in October - part of a massive effort to pump liquidity into the system, which some call "quantitative easing."
"The optimistic comments from the Federal Reserve and the not-so-subtle hints that the central bank is thinking about an exit strategy drove the dollar higher across all board," said Kathy Lien at Global Forex Trading.
The decision to complete the bond purchase program in October "suggests that they do not feel that the US economy needs additional stimulus at this time," Lien said.
"We actually believe that their decision to extend their purchase program to the end of October from September is a positive move because it suggests that the US economy is stable enough for them to spread out their stimulus instead of delivering it quickly and aggressively."
Lien added that the currency markets are starting to focus again on economic fundamentals instead of "risk aversion" that drove traders into safe-haven assets like the greenback and US Treasury bonds in times of turmoil.
Jessica Hoversen at MF Global said the initial dollar gains faded as the market assessed the Fed statement.
"You had this initial reaction higher in the dollar because the market interpreted the Fed statement as a move away from quantitative easing," she said.
"But the market switched on a dime once they saw the equity market rally ... the market could be slightly concerned with the government's determination to continue to spend. The market is very concerned that the (US) Treasury will not be able to fund its deficit."
In late New York trade, the dollar stood at 1.771 Swiss francs from 1.0815 on Tuesday.
The pound was at 1.6583 dollars after 1.6478. - AFP/de
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