MARIO Draghi might not be too worried about disappointing investors this week.
As markets look for the ECB president to unveil details of his bond-purchase programme this Thursday, Italy and Spain are showing little willingness to request aid from Europe's bailout fund; a pre-condition for the ECB to start buying their debt. A jump in bond yields may remind governments that they need to act first.
"The market is expecting a lot from the ECB," said Gustavo Reis, an economist at Bank of America Merrill Lynch.
"However, we look for little clarification on the bond-buying programme. The likely market disappointment should intensify the pressure on Spain."
Mr Draghi's plan hinges on governments asking the bailout fund to buy their bonds on the primary market, which would require them to sign up to strict conditions, before the ECB intervenes on the secondary market.
While Spanish prime minister Mariano Rajoy and Italian premier Mario Monti are heaping pressure on the ECB to act to lower their borrowing costs, they're resisting making an application to the bailout fund for aid.
"Draghi's announcement of intervention shows the robust will of the ECB to solve the problem," Rajoy said in a joint interview published over the weekend. "I will await the results of the ECB and then make a decision that's good for Spain and for the euro."
No single option has emerged as pre-eminent and ECB council members will have only about 24 hours to digest Mr Draghi's proposal before they start debating it.
The ECB's executive board will send a list of options to the 17 governors today, a day before the Governing Council convenes in Frankfurt, the officials said on condition of anonymity.
The meeting ends on Thursday, after which Draghi holds his regular press conference.
German chancellor Angela Merkel travels to Madrid for talks with Rajoy the same day.
The lack of a clear preference, the complexity of the issue and the shortage of time increase the risk that Draghi won't present a detailed plan this week, said economists at Commerzbank and JP Morgan Chase.
The ECB may also choose to hold back some details of the plan until the German Constitutional Court rules on the legality of Europe's permanent bailout fund next week.
"Draghi will be vague, and he should be," said Erik Nielsen, global chief economist at UniCredit Bank in London.
"He'll reiterate the conditionality aspect, that whatever they'll do will be 'enough'," and that "the objective of such interventions, if they happen, will be to prevent speculation of a eurozone break-up." (Bloomberg)