The dollar was mostly lower in N.Y. trade on Wednesday, with EUR-USD briefly clearing 1.3575, and USD-JPY dipping under 91.00. A much weaker than expected U.S. Q4 GDP result had only marginal impact on the greenback, and the markets in general, perhaps as the earlier ADP employment survey came in better than expectations. Dealings slowed into the FOMC announcement, though there was nothing more than a couple of hiccups from the dollar, when there were no real surprises. EUR-USD did touch trend highs of 1.3587, while USD-JPY bounced on either side of 91.00. In its statement, the Fed said economic activity "paused in recent months", but attributed it to "transitory" factors and weather. Employment expanded, household and business investment advanced, while global financial strains have eased. But the Fed still sees downside risks with the unemployment rate remaining elevated. Overnight trade is likely to be quiet, as markets gird for Friday's January U.S. employment report.

[EUR, USD]
Swiss name bids underpinned EUR-USD from 1.3540 into the N.Y. options cut and it extended through 1.3570 thereafter. Large offers were noted at 1.3580-90, while confirmed barriers are reported at 1.3600. An Asian sovereign sold into upticks since the N.Y. open and is widely reported to be defending the topside. However, model funds and momentum accounts are in driving seat as the earlier break above barriers at 1.3500 to 1.3550 reinforces the uptrend. Above 1.3600 there are levels to note from the middle of November 2011, where very large buy stops are widely tipped (between 1.3625 and 1.3640). EUR-USD touched 14-month highs of 1.3587 after the FOMC, though ran into sellers said to be lined up to 1.3600.

[USD, JPY]
The dollar knee-jerked lower against the yen following the ugly Q4 GDP print, taking USD-JPY briefly to 90.85 from 91.20. The pairing quickly recovered however, moving toward 91.30 after running into Japanese offers into the lows. From there, the pairing traded either side of 91.00 into the FOMC, before touching 91.25 into the close. further USD-JPY upside is likely to meet very strong resistance due to large outstanding 91.50 barriers and related plain vanilla strikes. There are up to $10 bln worth of strikes scattered at 90.00, 91.00 and 91.50 for tomorrow, which has attracted gamma hedging (dollar selling). 91.50 barriers also begin to expire tomorrow and should be well defended, while there is also good resistance at 91.47.

[GBP, USD]
Cable dug through offers into 1.5800 since the U.S. GDP print, which weighed on the dollar tone as U.S. yields gave up ground. Part of the GBP pick up is being pinned on demand related to a dividend payment, along with reserve management selling pressure via EUR-GBP from 0.8600. For the second consecutive session reserve managers have been noted on either of the cross. A European NCB was a buyer on dips in usual month-end flows, but interest to sell into strength is being pinned on activity related to an asset switch. U.K. assets are tempting for value traders at the moment due to the weaker pound despite poor economic fundamentals. Cable managed a move through 1.5800 after the FOMC announcement, though manage a high of only 1.5817 before pulling back.

[USD, CHF]
EUR-CHF breached 1.2400 and extended 1.2345. The cross struggled once again to sustain higher levels amid reports of good Swissy demand. Corporates, private clients and asset managers overwhelmed sporadic hedge fund activity. Gamma related EUR buyers emerged around 1.2380 after selling from 1.2450-60 at the European open, which points towards good outstanding expiries close to 1.2400. USD-CHF extended recent losses to trade under 0.9100 as month end related activity reinforced bearish technicals. The dollar pairing suffered sharp losses yesterday on corporate selling, which fits with similar flows via EUR-CHF.

[USD, CAD]
USD-CAD moved back over 1.0050, after finding support ahead of 1.0000 overnight. Buying interest from 1.0020-00 kept the pairing afloat, while the poor U.S. GDP print resulted in some short covering in early North American trade. The pairing later retreated back to opening levels near 1.0020, after running into sellers over 1.0050. Offers were reported from 1.0060, which halted early gains. Standing bids are noted into 1.0000, but stops should be a factor under 0.9990.