Say bye to the latest “recycled” ECB propaganda
The latest ECB rumour regarding an open-ended monetization without conditionality gives us the unsettling sense of dejavu, as it was around this time last year that according to unsourced rumors the EFSF was going to use 4x leverage. The difference this time is that the rumor didn’t have to wait long to get dismissed. With the German Minister of Finances refuting the ECB plan to target bond spreads in a matter of hours, nothing was eventually enacted or ever proposed. Despite that, peripheral bonds once again tightened on absolutely nothing, with the Spanish 10Y back in the 6.30% territory and we suspect the same rumor to be reincarnated once Spanish yields pass above 8% again.