The dollar dropped on Thursday after the Federal Reserve raised interest rates, as expected, and left open the possibility the U.S. central bank will pause in tightening policy in August.

The Fed raised overnight rates by a quarter percentage point for the 17th straight time in two years, to 5.25 percent, but said slowing economic growth should help limit inflation.

The euro reversed small losses after the Fed’s policy statement was released, rising 0.5 percent to a session high of $1.2662 from around $1.2530 before the Fed’s decision and statement.

The interest rate futures market reflected a 50/50 chance the Fed will hike rates by a quarter point again in August, sharply down from around 80 percent earlier Thursday.