Posts Tagged ‘EONIA’

Notes From Underground: ECB’S Mario Draghi Dances, DOLLAR LONGS SEARCH FOR AN EXIT

June 6, 2013

In a “flash,” the LONG DOLLAR positions of the taper crowd came a crashing down upon committed U.S. dollar bulls. The position unwinding started during President Mario Draghi’s press conference. I was a very attentive listener to the Q&A session and am very hard pressed to see anything positive about Europe in Draghi’s answers. In fact, the EURO began its rally just after said that the ECB was “… technically ready for negative rates.” It seems that the ECB council was again discussing the possibility of having EONIA go negative in an effort to unlock the bank deposits currently sitting at the ECB. The fact that the ECB has drawn up plans for “GOING NEGATIVE” is not a bullish EURO indicator. The most bullish and honest statement from President Draghi was he maintained that the ECB has been the most conservative of all the central banks.

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