by Calculated Risk on 5/14/2010 11:57:00 AM
Friday, May 14, 2010
Euro Declines on Growth Worries
From the Financial Times: Euro plunges as growth worries mount
[S]igns of deflation emerged in Spain and concerns grew that the latest tough austerity measures across Europe would damp growth in the region. This sent the euro to new 18-month lows against the dollar and gold to a new high.At the same time China is trying to slow down their overheated real estate sector market:
excerpt with permission
[T]he China Securities Journal reported that Shanghai’s municipal government was putting up nearly 40 lots of land for sale in the city’s most extensive release yet.And the stronger dollar will probably impact U.S. exports to Europe (although trade to Europe is a fairly small part of U.S. GDP). Still manufacturing has been one of the better performing U.S. sectors, but with the inventory correction mostly over (businesses are now building inventories) and if exports soften - this will impact U.S. growth.
A 2nd half slowdown in the U.S. appears very likely.