Evercore Pan Asset

There have been disappointing figures and news from the UK on inflation, from China on exports and property and from Euroland on the struggles to cut deficits. Markets are having a wobble after a very good run up so far this year.

There are signs around the world that all the money being created by Central Banks is having a positive effect on asset values and economic activity. We can expect the authorities to want to keep money as loose as possible, as many governments do not wish to see a return to recession.

It is good news that the Greek debt default passed off well in Stock markets. This was helped by the large sums lent to EU banks by the European central Bank. Unfortunately actions taken so far do not guarantee that Greece, Spain and the others can now control their deficits as required. The Euro crisis is not over.

Markets have been upset by the Chinese downgrade of their growth forecasts. It should have been no great surprise. After all, the Chinese authorities spent most of last year trying to slow their economy down a bit to curb price increases, and many western commentators were forecasting a hard landing. 7.5% will be a good result if they achieve it, and still leaves western growth rates standing.

We should be wary of the Greek crisis again this week. Not all the private sector creditors are happy about taking large losses on their bonds, whilst the rest of Euroland is demanding more performance on the cuts and assets sales before releasing all the money. There could be more disappointment ahead.