Further comments by ECB governing council member, Vitas Vasiliauskas

ECB
  • Need to see first how the virus is affecting the real economy
  • The virus is a very important aspect and possible risk
  • Outbreak seems more like a supply shock in the beginning
  • But now the reaction is 'very active', can also expect demand-orientated shocks
  • ECB must observe the situation very carefully
  • Does not think that the ECB can do something in the March meeting
  • Says "we are living in the regime of wait and see"

This very much fits the tune with what Lagarde was trying to communicate yesterday. I think the ECB can be glad the outbreak hasn't quite affected France and Germany all too much but it may be too early to tell for now.

Anyway, the market isn't expecting much ahead of next month's meeting but a 10 bps rate cut has already been more or less fully priced in for the June meeting:

WIRP EU