2 for base index very followed by the bond market

After their meeting rough the day before, stock markets have are resumed modestly yesterday through temporary stabilization of the dollar and the decline in long rates. Have the yields of the Bund and the OAT to 10 years French lost 3 basis points respectively to 3.98 and 4. The DJ Stoxx 50 index earned for 0.46 share. The dollar slowed its depreciation against some currencies and stabilized over others, such the European currency ended 1,2825 dollar.

The pronounced decline in the dollar for several weeks would finally resolve person, neither Europe nor the United States, according to Patrick Artus, Chief Economist of Ixis. Economist note first that the dollar's real effective exchange rate is already very weakened and that the price competitiveness of the United States is the best since 1985. However, "the US external deficit is essentially the decline in the savings rate, itself associated with the strong growth of credit to individuals, and therefore want to correct this deficit by a depreciation of the dollar is not legitimate", believes Patrick Artus.

Force of the euro

In addition, specialization industrial American new technologies implies that they are less substitutable realized foreign productions, and a decline in the dollar increase so the prices of imports and degrade foreign trade in value,. So the Economist does not to a concerted plan major countries of the g-7 would be behind the current decline in the greenback. Would he open the box of Pandora: depreciation could develop into collapse of the dollar, and the induced risks would be much more important than any removed profits.

Echoing of the concerns that began crab-wise on the holding of the greenback, the Governor of the Bank of France Christian Noyer, who sits on the Council of the European Central Bank, said yesterday that a "brutal adjustment as a depreciation of the dollar, would cause major disturbances and could undermine growth prospects currently favourable the global economy". It is the strength of the euro which is behind the diving German index ZEW barometer of expectations of the financial sector for the German economy. The index fell 50 points in may, representing a decline of 12.7 points from the previous month. Very dependent on exports, the German economy should bear the costs of the appreciation of the euro. In contrast, industrial production in the euro area pleasantly surprised the market by a gain of 0.4 percent in March, according to data from the European statistics office Eurostat.

The bond reassured

In the United States industrial production jumped 0.8 in April, after a 0.6 percent increase the previous month. An increase greater than the expectations of analysts who projected an increase of 0.5. Production prices increased by 0.9 in the same period, while base (excluding food and energy) index increased by 0.1, while the consensus of analysts was on an increase of 0.2 for base index, very followed by the bond market. The latter was rather reassured by this figure, which permitted him to advance a little early in the day. Thus, the performance of the T-bonds to 10 years closes by 4 basis points to 5,111.

In addition, the new decline in starts of housing, from 7.4 in April, to 1,849 million units on an annual basis, testified to the shortness of the real estate market. This figure, the lowest since November 2004, is lower than the expectations of analysts who projected 1,950 million units on an annual basis. However, it is a shortness of breath much more important that would be necessary to penalize the consumption and the confidence of households through a "wealth effect" negative.