ECB QE Leak ?

Shortly after the open the Dow Jones newswire reported (actually the WSJ put it out first) that the ECB is proposing a $50 bn Euro a month QE program to last at least a year. From WSJ...

"A proposal from the European Central Bank’s Frankfurt-based executive board calls for bond purchases of roughly €50 billion ($58 billion) per month that would last for a minimum of one year, according to people familiar with the matter.

The ECB’s executive board met Tuesday to decide on the proposal, which will form the basis of deliberations by the entire 25-member governing council on Thursday. The final number and details could change after the full board weighs in on the plan.

Still, the executive board’s proposal indicates that the ECB could move more aggressively than financial markets have expected. Forecasts among analysts have recently centered on a figure of around €500 billion or higher for a quantitative-easing program, but the executive board’s proposal suggests that bond purchases could amount to at least €600 billion.

An ECB spokesman declined to comment."

If so, why was the knee jerk reaction so limited and some obvious disappointment?

SPX reaction to the early news and then seeming disappointment.

It could be the leak was not a leak and a retraction is on the way or perhaps more likely, rumors have been circulating of late that the ECB would come out swinging with "Shock and Awe", the whisper number for such a plan was $1 trn a year, $600 bn a year is substantially lower.

In addition, this is a proposal if the leak is correct, which would still have to go through the full governing council of 25 tomorrow.

Not exactly the reaction one might expect on ECB QE.