Marcus Ashworth is a Bloomberg Gadfly columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.

Mark Gilbert is a Bloomberg Gadfly columnist covering asset management. He previously was a Bloomberg View columnist, and prior to that the London bureau chief for Bloomberg News. He is the author of “Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable.”

European Central Bank President Mario Draghi was resolutely dovish at today's press conference, but one remark stood out:

The last thing the Governing Council wants is an unwarranted tightening of financial conditions.

That is a covert warning to the bond market that if yields were to race too high, too fast, then the ECB stands ready to act -- as it has done in the past. His comment did the trick.

A Shot Across the Bond Market's Bows
"The last thing the governing council wants is an unwarranted tightening of the financial conditions," says Mario Draghi
Source: Bloomberg
Intraday times are displayed in Eastern Standard Time

The ECB, Draghi said, can remain "confident" in the growth outlook, but needs both "patience" and "persistence" in maintaining its stimulus program. "Inflation is not where we want it to be and not where it should be," he insisted. 

So much so he has even left wiggle room for the decision on when and how tapering of the bank's quantitative easing program will be made. When asked directly what his repeated use of the word "autumn" actually meant, he replied that if had wanted it to mean Sept. 7  -- the date of the next ECB meeting -- he would have said so.

Oct. 26, then, is in play, although September remains the most likely time for policy makers to start talks about taking their collective foot off the accelerator.

But Draghi doesn't want the bond market to get ahead of itself and threaten to damp inflation by prematurely pushing up borrowing costs. The ECB, Draghi insists, can still do "whatever it takes" to keep the economic recovery on track.

For now, bond traders are taking him at his word.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the authors of this story:
Marcus Ashworth in London at
Mark Gilbert in London at

To contact the editor responsible for this story:
Edward Evans at