FXStreet (Delhi) – Jim Reid, Research Analyst at Deutsche Bank, notes that there was a lot of screaming and howling in markets yesterday as the ECB made a mockery of all the high expectations for aggressive action. Key Quotes “Not only did they disappoint but they gave no indication that they were on the brink of doing more in Q1. On such occasions it's tempting to blame markets for getting ahead of reality but it does feel to us that the ECB have made communication errors in the last month or so that led to us all expecting much more.” “Our European Economists wondered whether Draghi failed to build a consensus for further action and had underestimated his ability to do so in recent weeks. They suggest that he yesterday changed emphasis in his comments towards the positive developments on growth after not having done so for the last few weeks which have helped expectations to build.” “The main consequences for the Euro economy could be through the exchange rate and through tightening of financial conditions. Our European Economists' forecast for 2016 growth of 1.6% was helped by an assumed 5% decline in the trade weighted index. If the currency doesn't decline this would reduce by 0.2%.” “In terms of financial conditions, one day's move doesn't make a trend but the initial moves in equities, bonds and the currency already go someway towards tightening conditions. It'll be interesting to see if they go further. Much might also depend on inflation expectations after this announcement. It doesn't feel like a "whatever it takes" moment so will the market start re-pricing lower inflation again?” For more information, read our latest forex news.