It’s not often that I agree with a member of the ECB, but I think comments made by the ECB’s Yves Mersch sum up my thoughts very well indeed. He said that the current recovery is not sustainable and that he expects banks to have to make more bad loan provisions by the year end. He goes on to say without a global rise in demand there will be no investment, new jobs and that as long as global growth is supported by public money, then we can’t talk of sustainable growth.
It is interesting to note how the ECB members refuse to join in the optimism exhibited elsewhere over the European economy and Mersch echoes my thoughts that without a demand recovery, which is going to be tough in an era of high unemployment, there will be no return to the good old days.
Eur/Usd is back up at 1.4300 after falling to as low as 1.4290. Not the most exciting range for today.