The Dollar made a rebound on Thursday after the Fed again said it saw high inflation as ‘transitory’ and investor focus is now on the Bank of England for a possible rate hike.

On Wednesday the U.S. Federal Reserve announced a $15 million monthly reduction to its $120 billion in monthly purchases of Treasuries and mortgage-backed securities. However, Fed Chair Jerome Powell said there was no hurry in increasing borrowing costs, Reuters reports.

Initially, Powell’s stance was viewed as beneficial to risky assets, with Wall Street indexes closing at all-time highs whilst the Dollar endured a steep drop against a basket of major peers.

That said, investors are gradually taking a more balanced view of the Federal Reserve’s policy update as well as the positive data for the U.S. services industry.

Moreover, the Dollar index reverted from a low of 93.80 points just after the Fed’s announcement to 94.25 points early on Thursday, the highest since Monday.

"I think most people would have been looking for a dip to buy Dollar," according to Kit Jukes, a macro strategist at Societe Generale.

In addition, the Euro was still under pressure against the Dollar, as the European Central Bank looks to be way behind the fed in regard to tightening.

The Euro declined against the Dollar on Thursday, a fall of 0.5% at $1.1578.

Furthermore, the Pound was down 0.3% at $1.3644 as investors waited to see if the Bank of England would announce a rate hike.

Elsewhere, the Japanese Yen edged down, with one Dollar standing at 113.98 Yen, not far off the greenback’s multi-year top of 114.69 Yen reached in October.

The Australian Dollar fell 0.26% at $0.7430, near Tuesday’s levels as the central bank adopted a dovish stance at this week’s meeting.