The ECB’s Smets told MNI that the ECB “will not wait until New Year’s Eve to tell the markets what will happen on the first of January”, adding that in his view “it makes a lot of sense and is logical to keep” the sequencing of stimulus reduction as it is, which suggests, Smets wants to first phase out QE and then eye rate hikes. Smets confirmed that the “next reassessment will happen with the new staff projections in June”, adding that while risks to growth are “close to balance”, it is too early to declare that inflation is durably converging to its target. Analysts reckon this is pretty much a confirmation that the ECB is inching towards exit steps, and a clarification of tapering for 2018. But what if like the Fed, this normalisation happens slower than the market expects? Today we feature a piece from Unicredit that looks at the potential scarcity of core European bonds, in particular, Germany, in the context of a slower than expected tapering. We also wanted to highlight again, a piece we featured yesterday from Goldman Sachs that looks at cross asset correlations in the context of this month’s OPEC meeting where an extension of production cuts is widely expected. Some of the oil analysts we speak to have presented a few interesting stats. For instance, In 2016 oil discoveries were 2.4bn compared to a 15 year average of 9bn. WTI based around 16 days before the OPEC deal on 30 November and this time 20 days before the anticipated deal on 25 May. However, back in November, oil prices also peaked 5 days ahead of OPEC, and did not go into the meeting at the highs, so there doubts among the analyst community that this rally is sustainable. FX strategists also note that trading desks had one of their highest volume days ever of CAD selling on the day that WTI based.