Exit strategy from the ECB is the market’s focus and Austria’s Nowotny is giving us what we’re looking for. He says better conditions in financial markets means that not all liquidity measures being provided by the ECB will be needed in the future. The ECB will make sure that the measures will expire and excess liquidity is drained to avoid inflationary risks. High unemployment may slow down the recovery, he notes, saying the recovery is not yet self-sufficient. Mid-term inflation risks are small and manageable, he says.

EUR/USD continues to rebound in the wake of ACB buying on dips. US equities are firming and even oil has moved into positive territory. Gold is at a fresh record, so it looks as though the reflation trade is coming back into sync. EUR/USD trades at 1.5075, eying 1.5100 barriers.