Plenty of Global Malaise to Go Around

Despite the fact that “Evidence Mounts of Strong Recovery” in the U.S., there are plenty of dispiriting ways to read the global economy today.

The European Central Bank said world economies are not doing enough to ameliorate global malaise in a monthly bulletin it put out today, as reported by the Financial Times’s Ralph Atkins, stating that “global imbalances continue to pose a key risk to global macroeconomic and financial stability.”

Atkins contrasts the “blunt” language to the normally staid tone of the ECB reports.

Meantime, China’s economy in Q1 rose 11.9%, the fastest rate in three years, raising worries of overheating, writes the FT’s Geoff Dyer. (Atkins noted that the ECB did not get into the matter of China’s currency policy in its report.)

And CMA’s sovereign risk monitor notes Greek bond yields were back on the march higher, with the spread of Greek bonds higher by 31 basis points to 437.25 after a sharp sell-off in Greek bonds. The FT’s Peter Garnham writes that the rise came as a result of reports in the German media that the European portion of proposed loans to Greece might triple to 90 billion Euros.

The Economist, in its Q1 outlook this morning, writes that “inventory rebuilding and fiscal and monetary stimulus are the main drivers of growth in many markets, and none of these factors is sustainable. In some countries, including the U.S., renewed weakness is in prospect once inventory restocking and policy stimulus have run their course.”