ECB FX intervention is unlikely

There has been some discussion of possible FX intervention by the ECB to support the euro, but there is next to no chance of that being announced at today’s press conference, and unless the single currency falls much further we think likely the Bank will limit itself to verbal interventions in future. Indeed, the ECB is more likely to tolerate a moderately weaker euro than before the Ukraine war in order to cushion the blow to euro-zone exporters from a collapse in trade with Russia.