FOMC statement hurts the Greenback

FXstreet.com (Barcelona) - Dollar is falling apart across the board after the FED statement. The Federal Reserve said it will buy up to $300 billion in longer-term Treasuries and raise the size of lending programs already aimed at reducing mortgage rates by another $750 billion, a forceful reminder that officials still have powerful tools to combat the recession.Market is watching a very strong greenback weakness, as the FOMC announcement of leaves its interest rate unchanged and to buy treasuries and to increase the MBS program to 1.25 Trillion Dollars should benefit most other assets, boosting risk sentiment. This was definitely a crowd pleaser from the Fed.According Nick Nassad, currency market analyst with CMS Forex, this announcement should benefit most other assets, boosting risk sentiment: "The importance of the Fed's announcement is that by buying Treasuries the Fed will to exert pressure designed to lower rates on the many corporate, mortgage and consumer loans linked to benchmark government debt. That will be positive for increasing money supply and boosting lending."EUR/USD has risen quickly more than 330 pips in the first minutes after the Fed decision of leave unchanged its interest rate at 0.25%. The pair has climbed up from 1.3104 to 1.3436, reaching a fresh eight weeks high.Nick says about EUR "I think there the strength we have been seeing in the EUR/USD had a lot to do with the recent rally in global equities as most traders did not expect this statement to buy treasuries to come out of the today's fed meeting."Cable has risen more than 320 pips from the 1.3944 to 1.4266 and the GBP/USD has reached a new two weeks high. About Cable, Nick says: "The GBP/USD has some more clearer resistance levels from two weeks ago that should limit further gains by the Pound, and as we mentioned the weak unemployment data adds to a sense that the UK economy is still facing a deepening recession."The USD/JPY has fallen around 400 pips from the 98.33 to test the 95.65 support (March 12 low). Japanese yen is close to break the 95.50 zone, momentum is bearish, and if does, more selling pressure could be seen on the pair.Nassad concluded related to JPY: "Japan would prefer to have a weaker currency to help boost exports but seems like 100 acted as strong resistance. We are establishing a downward channel with today's moves reaching the bottom line of support."