Draghi comment sends Euro to four year low
Speculation on outright ECB government bond purchases have sent the euro to a four year low at the beginning of the new year, following comments Draghi made in an interview with the German business paper Handelsblatt.
Draghi confirmed that the ECB has “initiated technical preparations to adjust the scope, speed and composition” of its measures to combat the threat of deflation in the eurozone, suggesting that further changes to stimulus measures could be expected this month.
As markets opened, the euro dropped by -0.6% against the dollar, sending the exchange rate to the lowest level in 4.5 years.
Meanwhile, stock markets in Germany and France opened with a decline, with the DAX dropping by -0.57% and the CAC40 by -0.16%.
Yields for 10 year Spanish and Italian bonds dropped by 0.09% and 0.06% respectively as of noon CET according to Bloomberg.
The next monetary policy meeting of the ECB governing council will be held on 22 January 2015.