Today sees the conclusion of Mr Draghi's attempts to bounce the ECB governing council into easing. By creating market expectations of easing Draghi has raised the cost of not easing, so the ECB will have to ease.
Is easing necessary? We did not change our GDP forecast when we changed our easing call, and suggestions that yesterday's decline in core CPI are a justification are wrong. However, the desire to try to contain bond market moves as the Fed tightens may be a reason.
Fed Chair Yellen's comments (and the supporting evidence of the Beige Book, noting some broadening of pay increases) continues to point to a faster pace of rate increases than the market has hitherto supposed – the market seems to be getting the message.
We have service sector sentiment data on the agenda today. The Euro number is likely to be subordinated to the ECB, but the US number may attract (undeserved) attention in the wake of the weaker manufacturing number.