Goldman: We Were Wrong On The Euro But Keep Selling

"We badly misread this meeting." -- Goldman's euro mistake

For those that missed it, yesterday the European Central Bank announced a modest cut in its deposit rate (10bps), to a historic low of minus 0.3%, and pledged to continue its €60bn-a-month bond buying programme for another six months until March 2017 “or beyond." The market was expecting a much more aggressive package of stimulus measures from the central bank and traders were betting heavily against the euro believing it was set to fall further as the ECB adopted a more dovish stance.

Goldman FX strategist Robin Brooks went so far as to say that:

"...that downside skew in EUR/$ is modest compared to the run-up to the Jan. 22 meeting. In short, we think risk-reward to short EUR/$...

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