Euro a Sell Either Way Post ECB, Bunds Likely to Drop With QE, SocGen Says

Investors may sell the euro regardless of whether the European Central Bank steps up measures to stem the region’s debt crisis at a meeting of policy makers today, according to Societe Generale SA.

“Failure to do something will see the crisis return in force after yesterday’s mini-hiatus,”Kit Juckes, London-based head of foreign-exchange research, said in an e-mailed note received today. It’s also “hard to see” how buying bonds under a so-called quantitative-easing program “is really good for the euro so it feels like a sell either way,” he wrote.

The announcement of an unsterilized bond-buying plan “would surely lead to a big sell-off in bunds,” Societe Generale analystsVincent Chaigneau,Aro Razafindrakola andHugues Naka wrote in a separate report yesterday. “This, however, is unlikely to happen,” they said.

The euro appreciated 0.1 percent to $1.3154 at 12:01 p.m. in London. The yield on the 10-year German bund climbed two basis points to 2.81 percent.

The ECB will leave its main interest rate at 1 percent today, according to all 52 analysts surveyed by Bloomberg.

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To contact the editor responsible for this story: Daniel Tilles at

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