While rate cuts were hoped for but not expected, the key to Draghi's jawboning or future easing efforts was hopes that the recent failed sterlizations of their SMP program (i.e. as close to outright money printing as they can get within the treaty as it stands) were supporting Europe. That was until:
- DRAGHI SAYS STOPPING SMP STERILIZATION WAS NOT DISCUSSED
DAX is re-tumbling, EURUSD is soaring, and US Stocks have crumbled 10 points to overnight lows. It seems everyone wanted some intervention... and for now Draghi has disappointed.
Notice the knee-jerk reaction on the statement and now the follow-through as reality bites...
S&P futures VWAP is around 1749 so expect a few pumps to that if we are to drop..