Despite the incompleteness of the advanced GDP report, the figures offer a sobering account of the softening in economic activity as consumers feel the impact of escalating oil prices and fading tax stimulus. The report should prod market participants to reassess Greenspan’s jovial appraisal of the US economy, upon which the recent dollar rally was largely founded. While this will not bar the Fed from raising rates, it means softer growth ahead, which is a negative combination of the economy and the dollar.
Friday, July 30, 2004
Greenspan's joviality revisited
From the Forex news of 7/30/04, commenting on the soft Gross Domestic Product report today: