NFP – Expect This And Be Surprised By That

Draghi's loose lips yesterday plunged the 17-member single currency through a three-cent handle before a bottom was found. The uttering of negative deposit Euro rates attempted to temporarily cripple the single currency ahead of this morning highly anticipated US employment report. The ECB did not need to take on any additional, more aggressive stimulus – instead they had Draghi mouthing deposit rates, which in effect, delivered the same impact as an aggressive cut. Investors were hoping for yesterday's rate cut to be the first on a list of measures to support a Euro-zone recovery. In the end all they got was an ECB that is able to move the market and not the economy.

24-hours later and Europe has two ECB members, Nowotny and Liikanen, trying to talk down the possibility of 'negative' deposit rates. Why try and undo what Draghi called "technically ready"? Surely a weaker EUR is a plus for exporters and a supporter of growth in the region. The mere fact that Draghi uttered...