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European Central Bank (ECB) Governor Mario Draghi and his men have been attempting to drag the euro lower for the past few days with very little success. Although most euro pairs have gapped down over the weekend thanks to ECB officials’ jawboning, it appears that the shared currency won’t go down without a fight. Is it about time that the ECB resort to quantitative easing?

“The strengthening of the exchange rate requires further monetary stimulus,” declared Draghi in his latest testimony. This was echoed by ECB official Noyer, who remarked that easier monetary policy is required in order spur euro depreciation. He went on to say that aside from dampening the euro zone’s export activity and economic recovery, euro strength would also prevent the region from achieving its 2% annual inflation target. “If the period of low inflation lasts longer than expected, we would have at our disposal many tools that we have used in recent years,” he added.

ECB policymaker Bonnici joined the jawboning bandwagon as he suggested in an interview that negative rates could make an impact in pushing euro exchange rates in the right direction. He explained that improved confidence in the region over the past year is the reason why hot money has been flowing into the euro zone, boosting demand for the euro. Meanwhile, ECB official Couere also pointed out that increased asset purchases could also be a policy option in engineering euro weakness.

However, Couere also noted that there are several obstacles facing the ECB when it comes to pumping up its easing efforts. For one, the fragmented nature of the 17-nation bloc poses a challenge in terms of achieving a unified reduction in borrowing costs. In other words, one country might be able to reap the benefits of further easing while other economies might have difficulties doing so. Economic analysts reiterated that the ECB needs to be very careful with its allocations of asset purchases or try to come up with easing plans tailored to each member of the region.

Despite these roadblocks, one thing is clear and it’s that Draghi and his men want to see a much weaker euro. Some ECB officials have even hinted that they’d like to see EUR/USD around 1.2500! Whether they achieve this through further jawboning or actual monetary policy easing remains to be seen.

Several traders believe that there are a few triggers that might force the ECB to act. One of these is a EUR/USD rally until the 1.4000 level and another is a weak CPI release on by the end of April. Some say that the ECB is all bark and no bite. What do you think?