Cable Update (GBPUSD)

Wednesday, July 07, 2010 23:45:27 EST
IMF updates World Economic Outlook: Raises 2010 global growth forecast to 4.6% from 4.2%; 2011 outlook unchanged at 4.3%; Cuts 2011 outlook for every G7 economy except US; Cuts 2010-11 for UK and France
- Raises China 2010 outlook to 10.5% from 10%;
- Raises 2010 Brazil growth outlook to 7.1% from 5.5%
- Raises 2010 EM to 6.8% from 6.3%
- Raises 2010 US growth outlook to 3.3% from 3.1%
- Reaffirms 2010 EU growth at 1%
- Raises 2010 Japan outlook to 2.4% from 1.9%; Sees 2011 at 1.8% v 2.0% prior
- Raises 2010 Mexico outlook to 4.5% from 4.2%
- Raises 2010 Russia outlook to 4.3% from 4.0%, 2011 to 4.1% v 3.3%
- Sees Spain economy contracting 0.4% in 2010, rising 0.6% in 2011

- Says market turmoil substantially raised downside risks
- Little evidence of financial turmoil impacting growth
- Inflation is subdued in advanced economies, to "edge up" in emerging economies
- Sees weaker EUR near "appropriate multilateral level"
- There is reason to be less positive than 3 months ago.

- Europe:
- Urges Europe to avoid a global spillover from sovereign debt problems.
- Negative spillover from Europe to other countries and regions could be substantial.
- European debt problems have caused setback in recovery from crisis.
- The European stress tests will require capital-deficiency plan.
- ECB needs to convince markets of commitment to bond purchases.
- Sees debt refinancing issues for some European countries and financial institutions.
- Decline in Euro, raises risk of disorderly currency market moves

- Advanced Economies:
- Advanced country central banks should continue crisis measures.
- Sees subdued inflation, deflation risks in advanced economies.
- Most advanced economies do not need to tighten policy before 2011.

Wednesday, July 07, 2010 21:59:13
(UK) Investor Jim Rogers comments on the UK - London Telegraph
- Does not have any investments in the UK or the US.
- Believes the UK's balance of trade and debt levels will worsen.
- Says he has not been buying stocks for at least 1 year and a half.
- Sees more currency turmoil ahead.
- Rogers is most positive on Asia.
- Says Asian economies cannot pull the world out of its difficulties.
- Says he bought the euro only for a rebound rally, does not mean he believes EU governments have their act together.
- Has been buying the Danish Kroner and Swedish Kronor.
- Reiterates that he owns gold and says silver could be a good investment.
- Notes concerns about the fiscal states of US municipalities.

**Reminder from Feb: (UK) Investor Jim Rogers: GBP may become a "basket case"; UK economy could be headed for double-dip recession - Guardian