You've got to take your hat off too him for his stage performances

With most of the market expecting no action until June he's gone and upset the applecart on those predictions by slapping March firmly in the crosshairs.

Is he right?

There's no denying his reasoning. The staff projections are based on a snapshot in time. Back in Dec (when the last projections were published) oil was trading around the $41-42 mark, so well away from current price levels.

The second round effects are an important factor too. While the oil price hits headline inflation, and is removed from the core, if prices remain low for a prolonged period then it starts to filter through into the core numbers. Given how much oil, in its various refined forms, plays a part of everyday life (food, goods production and manufacturing, packaging, fertiliser, on and on) then his worries are justified. Then you have the energy sectors themselves, job losses, strained finances etc. The second round effects can be far reaching and more damaging over the long run.

So on that basis they can't sit back. The question is how much will further policy action fix that? It's not doing the job now so how can more help?

For markets its a pure question of easing and the ECB are going full pelt. Further out we'll find out what good or damage it will do.

What stands out the most, by its absence, is yet again another central bank ignoring the possible implications from a collapse of the commodity industry and the financial ramifications of that. If he's so engrossed in watching for risks then this should be top of the agenda. Maybe it is but they don't want to panic markets by saying so. They're damned if they do and damned if they don't mention it, and then it blows up.

For today and the euro, the price action speaks volumes. With a lot of the market expecting more action later this year, nothing's changed but the possible date. The market got overexcited for action before the Dec meeting and is unlikely to do so again. If anything, there's a risk that it underestimates this time. We've tried a dip under 1.0800 and it's failed so I expect it to hold as support on another test from here on. As I mentioned this morning, there's a lack of willingness to push the boundaries of the recent range.

Draghi's feeding the bunny so it's ready for March