Forex Flash: ECB to be a non-event; Euro negative at the margin - Societe Generale

The ECB will not only leave rates on hold but also, it will offer no much in terms of headlines in the post press conference by Mario Dragui, says Kit Juckes, head of currency strategy at Societe Generale.

Kit notes: "Economic data are weak, the BTP market is fragile and now is simply not the moment to talk about the ‘crisis’ being over and monetary policy re-focusing on inflation-fighting."

"We’ve been led a merry dance so far this year by Mario Draghi but tomorrow, I expect a non-event, which will be bond-neutral and euro negative at the margin. After that, we can return to wondering how the current collection of protagonists can ever put together a government in Italy. And of course, I should mention that before we get to the ECB meeting, we have a Spanish bond action to digest. At least the US data have provided a calmer environment for that" Mr. Juckes adds.