Inflation will decline considerably this year, briefly approaching zero, says ECB managing board member Papademos.
The market expects the ECB to whack 50 bp from its offical rate next Thursday, at least.
All that is being overwhelmed by fears that the US will take control of two big banks as early as this weekend.
BofA CEO Ken Lewis is on the wires strongly denying and risk of nationalization but CEO assurances have had a way of blowing up in their faces in recent months.
EUR/USD is consolidating gains at 1.2860. Gold trades at an even grand.