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ECB prepared €500 billion QE program excluding Greece –

Bloomberg reports. The plan excludes Greece and is investment grade bonds. This figure is similar to estimations made  by economists. The assets meant for buying have been allocated by the staff according to the report, and naturally this  includes bonds that are not AAA.

EUR/USD around 1.1814, up from the lows seen yesterday. This is probably some kind of relief rally after the massive sell-off seen in recent weeks.

This program was presented in a meeting that was not supposed to discuss monetary policy on January 7th. This is a staff program presenting models. The decision awaits for January 22nd. There is no word as if the ECB will buy the bonds directly or delegate it to the national central banks.

What the report does say is that the governors of the ECB were asked not to offer their opinions in this meeting, but rather wait for the January 22nd meeting.

This is a sizable chunk, but is it enough?

There were probably hopes in markets that the size would be even bigger.

More:  EUR/USD: Conclusive Breaks On Long-Term Charts – Citi

The reaction to the news is relatively muted, and for two reasons:

  • The sum is close to the estimations made by economists – a very round number.
  • The markets are awaiting the Non-Farm Payrolls due in a few hours.

See how to trade the NFP with EUR/USD.


Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.