Fed now foresees fewer interest rate increases during 2016

That seemed at odds with Wednesday's report of solid growth in core consumer prices of 2.3 percent year-on-year, which some analysts said was a clear sign that the Fed's efforts to push up inflation were having effect. In dialing back rate expectations, the Fed said economic and financial developments continue to pose risks.

In a meeting with journalists, Federal Reserve Chair Janet Yellen said inflation "picked up" in recent months, but "continued to run below" the Fed's two percent target rate. She would not rule out the possibility of an April rate hike. Yet Yellen indicated during a press conference that she doesn't think those increases will necessarily continue.

Global stocks mostly rose Thursday, tracking gains on Wall Street after the Federal Reserve left interest rates unchanged and forecast it will raise rates more gradually than it had envisioned previous year. The central bank is expected to leave the interest rate at minus 0.75%.

After the Fed's decision, bond prices rose sharply and the yield on the 10-year Treasury note fell to 1.91 percent from 1.97 percent.

The dollar index hovered near a one-month low of 95.539 hit overnight after the Fed reduced its expectations for interest rate hikes in 2016 to two from four.

'A range of recent indicators, including strong job gains, points to additional strengthening of the labour market.

The lone dissenter was Kansas City Fed President Esther George, who favored a quarter-point rate hike.

Sentencing expected tomorrow for Ukrainian pilot
Ms Savchenko denied all allegations, claiming to have helped evacuate the wounded from the field during the attack. Western leaders, including Barack Obama and Angela Merkel, have also called for her release.

The Fed raised the short-term rate it controls in December from nearly zero for the first time in almost a decade.

According to him, the chance of a March hike was small mainly due to the fact that the Fed is "reluctant to surprise investors". Today at 10:30 CET Swiss National Bank Interest Rate Statement will be released.

"In the very short term, risk currencies... will do well as other risk assets including stocks and oil benefit from the Fed's dovish stance", Mansoor Mohi-uddin, senior markets strategist at Royal Bank of Scotland Group, told Bloomberg News.

She also warned inflation was still a major issue for the United States economy. "The domestic data, as of right now, are not unduly alarming".

"In our view, the Fed has become increasingly responsive to changes in financial conditions". It anticipates doing so until normalization of the level of the federal funds rate is well under way.

On Wednesday, the Federal Reserve also made it clear that officials will probably raise rates later this year, perhaps twice, in small increments.