Easy title for a complicated scenario: the EUR heads towards the ends of April easing against most of its rivals, as over the past few weeks, market players have been listening ECB officials bluffing on the benefits of a rate cut, and pricing it in. Market players already expect the Central Bank to take rates down from current 0.75% to 0.50%, a measly 0.25% cut.
With the economy on recession, and the OTM program accumulating dust, one should wonder how beneficial could be such rate cut. In fact, there are more chances that investors will take it as a last ditch effort, and will hardly provide support to EUR or increase the confidence in the ECB. A larger rate cut however, may provide some short term support to the common currency, but in the long run will do nothing to help solving the crisis, and will pass, leaving the fundamental picture unchanged.