Trichet starts press conference. Sees signs of economic recovery
See improving economy. That rates are currently appropriate and that the ECB policy supports the economy. Says inflation to move to positive YoY. This is as a result of the low numbers from July to December 2008 (when oil was plunging) falling out of the equation and being replaced by more normal values this year. He notes that the labor mkt is worse than though. He sees upside risks from stimulus (fiscal and monetary policy stimulus).
Trichet notes that GDP may return to positive and the economy should benefit from export growth. This is despite the EURUSD high rate. This may give the EURUSD some support.
He encourages the banks to improve capital base. He notes that perhaps as a result, that loans to businesses typical pick up after a lag (due to increasing capital base). He notes that the central bank will remove the extra liquidity if price risks emerge.
Regarding QE liquidity he says that not all the liquidity will be needed in the future. This is a positive assessment of the economy and is leading to a boost for the EURUSD
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