Forex Flash: EUR strives to normalize, LTRO in focus – UBS

The ECB will announce the repayment details for the second LTRO at 11:00 GMT. As highlighted previously, “since last July the euro is striving to 'normalize', and a part of the process involves greater sensitivity to front-end rates – EONIA levels have been essential in strengthening this relationship, and regardless of how the ECB truly feels about it, further withdrawal of excess liquidity via large LTRO repayments will be much sought after by euro bulls, as the currency seeks to avoid heading into the upcoming Italian elections on the back foot.” writes Research Analyst Gareth Berry at UBS.