ECB MAIN EVENT TODAY - EUR/USD

The main outcome of today's ECB events should be no rate change and a tough talking Trichet. If Trichet explicitly talks down hike expectations in early August, perhaps with such phrases as "we never do dramatic things on the telephone," or "we plan no press conference on August 3rd," the EUR should take a bad hit. However, if Trichet uses the "strong vigilance," or "exercise vigilance," phrase (implying an early August hike) the EUR should remain supported. Another avenue of support would come from any hint of a 50bp hike on August 31, although this would probably come via the Q&A session.