Bond Outlook [by bridport & cie, August 24th 2005]
Rather quietly, over the summer, a number of significant politico-economic changes have appeared, and which, taken together, are quite encouraging in the context of world economic rebalancing: |
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- Japan may have turned a corner with a pick up in domestic demand, the end of deflation in sight and the forthcoming election likely to allow Koizumi to proceed with reforms
- The German economy has returned to growth (and with it the Swiss)
- Germany under Merkel is likely to continue to turn eastward, depriving France of its main partner in the EU
- The US housing bubble is looking close to its end
- Following the Chinese change in its peg policy, Asian countries are diversifying their purchases of foreign Government bonds.
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