$32 bln in 4-week bills and $40 bln in 2-year notes are on offer over the next hour-and-a-half. If they are not easily absorbed a resumed slide in the dollar is likely.
Just crossing the wire, ECB managing board member Bini-Smaghi says that the transmission of monetary policy cannot necessarily be solved by zero interest rates. This is the classic “pushing on a string” argument, that you can lead an economy to a low interest rate environment but you can’t necessarily make it lend and borrow.
EUR/USD remains extremely thin, tumbling to 1.3120 from 1.3185 in short order. So far, 1.3112 fibo support is holding.
