Broadgate: Market News 2/2
2 February 2012
Countries like Greece, Ireland, Italy and Spain are being provided €496bn (£413bn) to recover from the trouble in Europe by Bundesbank, which is a part of the European Central Banks and Germany is now holding the ECB’s plans for its own economy risks The drastic contraction of the Greek economy has played chaos with shortfall of targets. Central bankers have remained silent on their intentions for Greece but on the other side Greece’s creditors are increasing pressure on the ECB to join the bond swap being negotiated with the country;. ECB wants to see the private-sector agreement concluded before indicating its strategy, which may include forgoing profits from its Greek bonds.
In the market this is a shifting focus to the US, with weekly unemployment data and productivity and labor cost data testifying before the House Budget Committee for the state of US Economy but the euro zone crisis could worsen and dampen the continental currency. On the other hand, the Federal Reserve’s statement about maintaining low interests rates makes the dollar less attractive to investors.
After the China’s no success over increasing consumption of gross domestic product, China’s growth is steady due to Bad Debts. New loans totaled $4 trillion from past three years, which is twice the size of the Italian economy, raising concern that some of the lending to local governments and property developers are worried on the other side China’s economy expanded 10.4 percent annually for past 10 years, The economy growth at a 9.2 percent rate last year and its expansion will slow to 8.5 percent as Europe and US decreases demands.
Gold higher to the top level from eight weeks, ahead along with equities and other commodities, as global manufacturing improved, fading dollar and boosting demand for alternative investments.
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