I’m most keenly watching Spanish bonds this week and they have edged modestly higher since Trichet began speaking. The spread between German and Spanish bonds is at 239 bp in the 10-year maturity from about 235 bp before the press conference began. The ECB has been an active buyer on bonds, presumably focused on Spain and Portugal, in the last hour…
EUR/USD fell as low as 1.3060 on EBS and trades now at 1.3090…
Germany reverting to the Deutsche mark is totally out of the question, Trichet says…. no shock there…
UPDATE at 14:37.. ye of little faith
