From BTIG’s Mike O’Rourke:
One last side note. The ECB did not do any Securities Markets Programme (SMP) purchases last week. That is the first time since October the ECB was not active. Most market participants would agree the EU has made some steady progress with the European Financial Stability Facility so perhaps less purchases are necessary. That being said, two weeks ago during a week of Spanish and Portuguese bond offerings, the ECB purchased €2.3 Billion in troubled sovereign bonds on the open market, the second most active week since July. It is starting to look like the ECB is only active with the SMP to support bond issuances. It is good to be a Central Bank because if a private investor were to support a security simply for the purpose of making a larger sale, the regulators would not be too happy.
Meanwhile on Friday, Merkel shall announce her crisis solution. It’s getting easier and easier to understand the big rally in the euro.