EUR flows: Little initial impact from ECB announcement

No change in key rate sand nothing particularly surprising in the ECB statement. Still talking fairly tough, saying “policy rates will be set at sufficiently restrictive levels for as long as necessary” but noting that, base effects aside, inflation has continued to decline. No significant initial market reaction, with more potential for the press conference to have an impact. We expect Lagarde will be as opaque as possible, but is still likely to suggest no rate cut before the summer, which might be mildly EUR supportive. But only mildly, as we also doubt this will cause the market to give up hope of an April cut.