Speaking in Vienna

  • ECB certainly won't discuss tapering in March

  • Do not expect the ECB to decide on the future of QE until after the summer

  • We will discuss policy in June but there won't be a tapering decision (there's a can kick for you)

  • Tapering would come first, followed by rate changes but only at a later point

  • ECB focuses on headline inflation and not the core

  • Talk of Italy and France leaving the Eurozone is absurd and would be economic suicide

  • A strong dollar helps Europe

  • Believes that Trump will hurt the US in the medium term

  • Ultra hard Brexit could be chaotic for the UK economy

  • Brexit could cause significantly bigger problems but there's been no negative effects so far

For someone not discussing QE or tapering, he's talked a lot about it. The gist is that we're all to sit on our hands until June at the earliest. His comment on the ECB concentrating on headline inflation and not the core is interesting as that's the one that's likely to surpass the ECB's target soon, if the current momentum remains. The core is also the number they can fall back on to suggest inflation isn't running hot. Maybe like the BOE, we'll start to hear the ECB's talking about tolerance levels.

EURUSD has now fallen through support to 1.0643, with EURJPY dropping also.