The euro jumped on the story.

From Reuters:

The European Central Bank is unlikely to take new policy action next week unless August inflation figures, due on Friday, show the euro zone sinking significantly towards deflation, ECB sources said.

“The barrier to QE is still very high,” said one of the sources, all of whom requested anonymity, adding that discussion at the meeting was expected to centre on reinforcing existing policy measures of credit easing and liquidity provision.

“It’s hard to say now that nothing will happen. It depends to some extent on the data,” the source added.

Deutsche Bank earlier today forecast the ECB would announce QE via ABS purchases on Sept 4.

August advance eurozone CPI is forecast to rise 0.3% y/y and 0.8% on the core.

Update: Another comment in the story that’s getting some attention is a call for the euro below 1.30.

A second ECB source noted that Draghi’s Jackson Hole speech had helped lower the euro, which fell broadly on Wednesday and hit a 19-month low against the Swiss franc.

“If we get the euro under $1.30, that helps a lot,” this source said. “We need a weaker euro for a stronger Europe.”