S&P 500 ESc1 and Nasdaq futures NQc1 pointed to Wall Street gaining around 0.8% when it resumes later.
Sterling GBP= was up 0.10% at $1.3395 ahead of the BoE decision as the dollar just started to ease from the seven-week high it had hit following the Fed's move, which its Chair Kevin Warsh had framed as removing "a dose of accommodation."
Benchmark 10-year UK gilt yields GB10YT=RR were slightly higher at 5.3%. German Bunds DE10YT=RR were nearly 3.53% while 10-year U.S. Treasuries US10YT=RR were hovering just below the key 5% threshold.
The Fed's quarter-point rate rise overnight had been a unanimous decision. The central bank's dot plot chart also projected one more hike this year, but stopped short of signalling any moves next year.
Tai Hui, APAC chief market strategist at JPMorgan Asset Management, said investors would need to reassess the valuations for assets especially tech stocks if the Fed remained hawkish going into 2027.
"We think the chance of U.S. policy rates returning to above 5% is still limited. Nonetheless, a catalyst to extend the equity bull market is looking unlikely in the foreseeable future," he added.
Commodity markets also took a hit from the dollar's overnight rise. Brent crude futures LCOc1 slipped another 1% after falling 2.7% overnight on reports Saudi Arabia was offering crude cargoes through Oman.
That had helped ease some of the concerns about Middle East supply disruption, following recent escalation of the seven-month war after attacks by Iran-backed Houthi fighters on Saudi cities.
Gold, however, showed some resilience, rising 0.7% to $4,293 an ounce XAU=, offsetting a similar fall overnight.
"We are still neutral on the dollar right now," Franklin Templeton's Wang said, explaining that the "bigger question" was whether its status as the world's top reserve currency would diminish at all over the longer term.
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