Bummer
EUR/USD extends sell-off, presently at 1.2773 having been to 1.2768.
- Weak euro zone economy is keeping interest rates at very low levels in Germany
- Inflation is well contained, expected to fall below 2% next year
- OMT bond buying plan is clear signal to markets that their fears about euro zone break up are baseless
- OMT allows for unlimited interventions in government bond markets
- ECB actions can build confidence in near-term, but only government action can secure it in longer term
