Dealers note talk out of Eastern Europe that the ECB will follow in the footsteps of the SNB and announce at tomorrow’s press conference that they intervene to weaken the euro.
Sounds like the type of rumor one starts when short a hundred pips lower. The ECB has been desperate to forestall a currency crisis so that the markets do not lose confidence in the pseudo-currency, so I doubt they would try and weaken the currency amid ongoing concerns over intra-European finances (Ireland, Greece, Spain…).
It is much more likely that the ECB will dip a toe into the quantitative easing waters, perhaps extending medium-term loans to banks, buying commercial paper or even corporate debt.
