Get ready for quantitative ease from the ECB. Trichet and others have spoken about it repeatedly in recent days.
It is no longer a question of if the ECB will be move to expand its quantitative easing measures, it is a question of when and in what form it will come. Trichet’s right-hand man( literally sitting next to him at each month ECB press conference), executive board member Papademos, said earlier today it is a possibility they are exploring. As we’ve noted before, it is unlike that the ECB will follow exactly in the footsteps of the Fed and the BOE and buy government bonds, but they are likely to extend term loans and buy commercial paper.
EUR/USD is wallowing in the lower half of recent ranges after finding support at 1.3480 this morning. It trades now at 1.3535.
