Nouriel Roubini, the famous economist, says that all major economies around the world will se a serious slowdown. The major reason is that the weapons against financial problems are limited and almost exhausted.
Mr. Roubini is sure that the steps to save the needy eurozone economies are ineffective. The latest EU summit failed to work out efficient measures to resolve the eurozone crisis. Markets were disappointed by the ECB’s decision to cut the key interest rate by 0.25%. They lost 35 after the news. The Italian bond market looks unstable. The yield hase already exceeded 6%.
The ECB is the only financial institution that can solve the short-term problems – to monetize the debt liabilities. However, some Northern members of the EU disagree to pay for the risky economies.
Therefore, if financial markets collapse along with economies, there won’t be enough funds to withstand economic shocks. Most countries have already spent 95% of the funds to ease multiple financial difficulties, which resulted from the 2008 crisis. Mr. Roubini says there won’t be such an opportunity in 2013.
According to , the USD index continues its rally against other major currencies. It has already touched a strong level of resistance at 83,67. If the price consolidates above the level, the mid-term uptrend will continue. The closest level of support is currently located at 81,82. If the price breaks and consolidates below it, the mid-term uptrend will be reversed.
