Comments from ECB Governing Council member Nowotny:

  • Eurozone is still far away from ECB inflation goal
  • Growth levels in eurozone are still very low

Suddenly the tone is a bit different from Nowotny. A couple months ago they liked to bury their heads in the sand and ignore the declining fundamentals while saying that “medium-term” inflation expectations were in line with forecasts.

It’s good news that policymakers are recognizing the extent of the problem and making moves to fix them.

EUR/USD is flattish today but it’s been relegated to a sideshow with all the flows in EUR/GBP on referendum fears.