“We will have to see if the increase in nominal yields will have a negative impact on financing conditions,” the European Central Bank (ECB) Vice President Luis De Guindos said in an interview with Público on Tuesday.
“If so, we are open to recalibrating our program.”
“Recent rise in yields is partly due to higher inflation expectations in the US.”
“That includes the PEPP envelope, if necessary.”
“We have the flexibility that is needed in order to react.”
EUR/USD attacks 1.2000
EUR/USD is eyeing a firm break below the 1.20 level, as the US dollar continues to hold firmer in the European session amid intensifying risk-off mood. The spot is down 0.34% so far. Focus shifts to the Eurozone Prelim CPI release.