Dollar pares gains after Fed statement

NEW YORK (Reuters) - The dollar pared gains against the euro after the Federal Reserve held interest rates steady as expected on Wednesday, but indicated policymakers anticipate reducing borrowing costs by half a percentage point by the end of this year.

Taking stock of the Trump administration's rollout of tariffs, Fed officials actually marked up their outlook for inflation this year, with their preferred measure of price increases expected to end the year at 2.7% versus the 2.5% pace anticipated in December. The Fed targets inflation at 2%.

The euro was 0.49% lower at the day at $1.0889, after slipping as low as $1.0860, earlier in the session. The dollar index, which tracks the greenback against six major currencies, was last up 0.35% at 103.65.

(Reporting by Saqib Iqbal Ahmed)

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